Sally Loves to See a Movie as Soon as It

question 188

Multiple Choice

Sally loves to see a movie as soon as it is released in theaters.This is an example of _____

• A)a positive rate of time preference.
• B)utility maximization.
• C)diminishing marginal utility.
• D)relative preference.
• E)Pareto optimality.

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Definitions:

Initial Endowment

The initial allocation of resources, money, or goods that an individual, institution, or country possesses.

Pareto Optimal

An allocation of resources from which it is impossible to reallocate to make any one individual better off without making at least one individual worse off.

Utility Function

A mathematical representation used in economics to model the satisfaction or happiness a consumer derives from consuming goods and services.

Edgeworth Box

A diagram used in microeconomics to show the distribution of resources and the optimality of trade-offs between two agents in an economy.