Suppose a Consumer Is at an Optimum

question 318

Multiple Choice

Suppose a consumer is at an optimum. What happens when the price of one good she has been consuming increases?

• A) The value of the marginal utility of the last unit consumed decreases.
• B) The value of the marginal utility of the last unit consumed increases.
• C) The marginal utility per dollar spent on the last unit consumed of that good increases by the same proportion as the price increases.
• D) The marginal utility per dollar spent on the last unit consumed of that good is now smaller than the marginal utility per dollar spent on other goods the person consumes.

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Definitions:

Earnings Per Share

A financial ratio representing the portion of a company's profit allocated to each outstanding share of common stock.

Net Income

The total earnings of a company after subtracting all expenses and taxes from total revenue, representing the company's profit.

Outstanding Stock

Capital stock that has been issued and is being held by stockholders.

Weighted-Average Number

A calculation that takes into account the varying degrees of importance of the numbers in a data set, used to find a kind of average that considers weight.