Absolute value-current consumption bundle is strictly

Assignment Help Business Economics

Reference no: EM13859043

The absolute value of Mars’ MRS at his current consumption bundle is strictly greater than 2. Mars has convex preferences. Which of the following statements is (are) true? Justify your answer graphically.

1. Taking away some of good 1 and giving Mars 2 units of good 2 for each unit of good 1 taken away will necessarily make him worse off.

2. Taking away some of good 1 and giving Mars 2 units of good 2 for each unit of good 1 taken away will necessarily make him better off.

3. Giving Mars some of good 1 and taking away 2 units of good 2 for each unit of good 1 he is given will necessarily make him worse off.

4. Giving Mars some of good 1 and taking away 2 units of good 2 for each unit of good 1 he is given will necessarily make him better off.

Reference no: EM13859043

Questions Cloud

Which activity would require the largest capital charge : Which activity would require the largest capital charge under the 1988 basel accord: a loan to another bank or a loan mnc? would this necessarily be true under the basel rules?

Use separate graphs to sketch two indifference curves : Use separate graphs to sketch two indifference curves for people with each of the following utility functions.

Utility function-goods in order to maximize his utility : Linus has the utility function U(x1, x2) = x1 + 2x2. If the price of good 1 is $1 and the price of good 2 is 50 cents then Linus must consume equal amounts of both goods in order to maximize his utility.

What was the principal debt instrument used : The US economy borrowed heavily from the British in the nineteenth century to build a railroad system. What was the principal debt instrument used? Why did this make both countries better off?

Absolute value-current consumption bundle is strictly : The absolute value of Mars’ MRS at his current consumption bundle is strictly greater than 2. Mars has convex preferences. Which of the following statements is (are) true? Justify your answer graphically.

What does the fed auction at the term-auction facility : The money multiplier equals 1/R, where R represents the quantity of reserves in the economy. If the money multiplier is 2 and the Fed buys $50,000 worth of bonds, what happens to the money supply? What does the Fed auction at the Term-Auction ..

Compute net sales for the two months : Assume that Sales Returns and Allowances, Sales Discounts, and Credit Card Discounts are treated as contra-revenues; compute net sales for the two months ended December 31, 2013. (Do not round your intermediate calculations.)

Examine decision-making systems and techniques : Examine decision-making systems and techniques to engage organisational intelligence and analyse how these can enhance entrepreneurial outcomes.

Determine the transaction price : Determine the transaction price for this contract.

User Account

All Pages