A Higher Price for a Good Implies That

question 271

Multiple Choice

A higher price for a good implies that

• A) the marginal utility of the good has declined.
• B) the total value of the good to the consumer has increased.
• C) the sacrifice of utility of another good has increased.
• D) the marginal utility of another good has decreased.

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Definitions:

Cash Operating Expenses

Expenses that a company must pay out in cash, such as salaries, utilities, and rent, related to its operational activities.

Incremental Sales

The addition to total sales generated by a specific business activity or decision, beyond what would have otherwise been achieved.

Income Tax Expense

The cost charged against earnings from operations and other activities, representing the amount of income taxes owed to governmental authorities.

Working Capital

The difference between a company's current assets and current liabilities, indicating short-term financial health and operational efficiency.