Since Indifference Curves Depend on the _____ for Individuals,this Means

question 88

Multiple Choice

Since indifference curves depend on the _____ for individuals,this means that two consumers with the same income _____.

• A)utility function;must consume different amounts of the two goods
• B)utility function;may consume different amounts of the two goods
• C)optimal utility rule;must consume different amounts of the two goods
• D)marginal utility function;have the same marginal utility for two goods.

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Definitions:

Diminishing Marginal Returns

A principle stating that as additional units of a variable input are added to a fixed input, the additions to output will eventually decrease.

Law of Diminishing Returns

An economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other variables remain constant.

Total Cost

The aggregate of expenses related to the manufacturing of products or provision of services, which includes costs that stay the same as well as those that vary.

Fixed Costs

Expenses that do not vary with the level of production or business activity, such as rent, salaries, and insurance premiums, remaining constant regardless of output.