Explain why a marginal rate of substitution between two goods must equal the ratio of prices of the goods for the consumer to achieve maximum satisfaction. a consumer achieves maximum satisfaction when the marginal rate of substitution is equal to the ratio of prices because
a. otherwise the consumer could trade one good for another at market prices to obtain a higher level of satisfaction.
b. the marginal rate of substitution is equal to the ratio of the goods' marginal utilities when satisfaction is maximized.
c. satisfaction is maximized when an individual consumes an equal amount of all goods.
d. satisfaction is maximized when an individual consumes the same amount of each good as other consumers.
e. the marginal rate of substitution is less than the magnitude of the slope of the indifference curve when satisfaction is maximized.

Leon and sara are arguing over when the best time is to degrease soup. leon says that it's easiest to degrease soup when it's boiling. sara says it's easiest to degrease soup when it's cold. who is correct? a. neither leon nor sara is correct. b. leon is correct. c. both leon and sara are correct. d. sara is correct. student b   incorrect which following answer correct?

Trey morgan is an employee who is paid monthly. for the month of january of the current year, he earned a total of $4,538. the fica tax for social security is 6.2% of the first $118,500 earned each calendar year, and the fica tax rate for medicare is 1.45% of all earnings for both the employee and the employer. the amount of federal income tax withheld from his earnings was $680.70. his net pay for the month is .

Blue computers, a major pc manufacturer in the united states, currently has plants in kentucky and pennsylvania. the kentucky plant has a capacity of 1 million units a year and the pennsylvania plant has a capacity of 1.5 million units a year. the firm divides the united states into five markets: northeast, southeast, midwest, south, and west. each pc sells for $1,000. the firm anticipates a 50 perc~nt growth in demand (in each region) this year (after which demand will stabilize) and wants to build a plant with a capacity of 1.5 million units per year to accommodate the growth. potential sites being considered are in north carolina and california. currently the firm pays federal, state, and local taxes on the income from each plant. federal taxes are 20 percent of income, and all state and local taxes are 7 percent of income in each state. north carolina has offered to reduce taxes for the next 10 years from 7 percent to 2 percent. blue computers would like to take the tax break into consideration when planning its network. consider income over the next 10 years in your analysis. assume that all costs remain unchanged over the 10 years. use a discount factor of 0.1 for your analysis. annual fixed costs, production and shipping costs per unit, and current regional demand (before the 50 percent growth) are shown in table 5-13. (a) if blue computers sets an objective of minimizing total fixed and variable costs, where should they build the new plant? how should the network be structured? (b) if blue computers sets an objective of maximizing after-tax profits, where should they build the new plant? how should the network be structured? variable production and shipping cost ($/unit) annual fixed cost northeast southeast midwest south west (million$) kentucky 185 180 175 175 200 150 pennsylvania 170 190 180 200 220 200 n. carolina 180 180 185 185 215 150 california 220 220 195 195 175 150 demand ('000 units/month) 700 400 400 300 600