Table 6.3 -Refer to Table 6.3.The Table Above Shows Lee's Marginal Utility

question 104

Multiple Choice

Table 6.3
-Refer to Table 6.3.The table above shows Lee's marginal utility per dollar from consuming ice cream cones and cans of Lemonade.The price of an ice cream cone is $2 and the price of Lemonade is $1.Use this information to select the correct statement.

• A)We cannot determine how many ice cream cones and cans of Lemonade Lee will consume without knowing what his income is.
• B)To maximise his utility, Lee should consume 1 ice cream cone and 5 cans of Lemonade.
• C)We cannot determine how many ice cream cones and cans of Lemonade will maximise Lee's utility because we are given only the marginal utility per dollar values.We also need to know the marginal utility for each quantity.
• D)If Lee has an unlimited budget, he will maximise his utility by buying only Lemonade.

Understand the components and significance of the balance of payments accounts.

Examine how currency valuation affects international investment flows and trade balances.

Understand the transition from the U.S. being a creditor nation to becoming a debtor nation and its implications.

Analyze the relationship between personal savings rates and the current account balance.

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