Multiple Choice
Frank buys only milk and cereal, both of which are normal goods, and he always maximizes his utility. Frank's boss cuts Frank's pay by $200 per month. What happens to Frank's marginal rate of substitution between milk and cereal?
A) It fluctuates randomly.
B) It decreases.
C) It increases.
D) It stays constant.
Correct Answer:
Verified
Correct Answer:
Verified
Q4: Higher indifference curves represent _ lower curves.<br>A)less
Q60: Consumers buy both alcoholic and nonalcoholic beverages.If
Q77: An indifference curve shows combinations of two
Q102: For most goods,as we move down an
Q116: Higher indifference curves represent:<br>A)less utility than lower
Q151: If, for Adam, the marginal utility of
Q152: If good A is a normal good
Q155: Calculating the marginal rate of substitution assumes
Q161: An individual consuming two goods, X and
Q176: The consumption bundles that Mei CAN afford