Multiple Choice
Carl has the utility function U(x,y) = x2 + y. He consumes 4 units of x and 10 units of y. If both goods are normal goods and if the price of x increases, then:
A) Carl will reduce his consumption of x to zero.
B) Carl will consume more x.
C) Carl will reduce his consumption of x to a positive amount.
D) Carl will consume the same amount of x.
Correct Answer:

Verified
Correct Answer:
Verified
Q36: The income effect is:<br>A)the change in utility
Q37: Religions tend to stress the importance of
Q38: Bonnie spends her entire income, $200 on
Q39: If a good is inferior and demand
Q40: You find a treasure chest with a
Q42: If the Paasche quantity index exceeds 1,
Q43: The ordinary demand curves reflects:<br>A)the income effect.<br>B)the
Q44: The law of demand holds when:<br>A)income elasticity
Q45: Show graphically how to derive a compensated
Q46: In a model where we take into