A Consumer Chooses an Optimal Consumption Point Where the

question 345

Multiple Choice

A consumer chooses an optimal consumption point where the

• A)marginal rate of substitution exceeds the relative price ratio.
• B)slope of the indifference curve equals the slope of the budget constraint.
• C)ratio of the prices equals one.
• D)All of the above are correct.

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Definitions:

Land Improvements

Expenses for enhancements made to a parcel of land to make it more usable, which do not directly include the land itself but, for example, landscaping, parking lots, and fences.

Depreciated

Refers to the reduction in value of an asset over time due to wear and tear or obsolescence.

Useful Life

The estimated period over which an asset is expected to be useful in the operations of a business before it is fully depreciated.

Broker Commission

A fee paid to a broker for executing a transaction or providing specialized services.