Exam 22: Consumer Preferences and Consumer Choice

Use the following to answer question: -(Figure: Consumer Equilibrium II)Use Figure Consumer Equilibrium II.The LOWEST level of total utility shown in the figure is associated with point _____ on curve _____.

For most goods,as we move down an indifference curve:

As an individual moves down his or her indifference curve,total utility remains constant.

Which of the following is NOT TRUE of indifference curves for ordinary goods?

Use the following to answer question: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.Assume that you are consuming the combination of goods at point I.Given the budget constraint FL,utility:

An indifference curve map illustrates _____ levels of utility,while each indifference curve in the map indicates consumption bundles that yield _____ level of utility for an individual.

Use the following to answer question: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.The highest level of utility is at point:

Use the following to answer question: -(Figure: The Optimal Consumption Bundle)Use Figure The Optimal Consumption Bundle.Which of the following could lead to an optimal consumption bundle on indifference curve I₃?

Maria derives 288 utils from buying 2 pairs of hiking boots and 4 saws.She gets 313 utils from buying 1 pair of hiking boots and 7 saws.Maria is indifferent between these two combinations of hiking boots and saws.

Assume that two combinations of two goods yield the same level of satisfaction.We can conclude that these combinations are always on:

Use the following to answer question: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.Assume that you are consuming the combination of goods at point G.Given the budget constraint FL,utility can be increased by moving to point:

Use the following to answer question: -(Figure: Consumer Equilibrium II)Use Figure Consumer Equilibrium II.The HIGHEST level of total utility is associated with point _____ on indifference curve _____.

A curve that represents combinations of two goods that yield equal levels of satisfaction is a(n):

Use the following to answer question: -(Figure: Harold's Indifference Curves)Use Figure Harold's Indifference Curves.If the price of bread is $1 per loaf,the price of cheese is $2 per pound,and Harold has $10 to spend on bread and cheese,Harold's optimal consumption bundle is _____ loaves of bread and _____ pounds of cheese.

Use the following to answer question: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.Assume that you are consuming the combination of goods at point G.Given the budget constraint FL,utility:

Higher indifference curves represent:

Use the following to answer question: -(Figure: Consumer Equilibrium III)Use Figure Consumer Equilibrium III.The lowest level of total utility at which Ivan still spends all of his income is associated with point _____ on _____.

(Scenario: Music Downloads and Streamed Movies)Read the scenario Music Downloads and Streamed Movies.Phillip's optimal consumption bundle will be one whose: Scenario: Music Downloads and Streamed Movies Phillip has an income of $300 per month,which he uses to purchase music downloads (MD)and streamed movies (SM).Each music download costs $1 and each streamed movie costs $5.

A typical indifference curve is _____,and its slope is the _____ of the good on the horizontal axis divided by the marginal utility of the good on the vertical axis.

Use the following to answer question: -(Table: Madeline's Preferences for T-Shirts and Coffee)Use Table Madeline's Preferences for T-Shirts and Coffee.Assume each consumption bundle provides the same level of utility for Madeline.Suppose Madeline is consuming bundle C.If she changes her purchases to bundle D,this means that she: