Exam 8: Utility and Demand

Total utility from -The above table shows Sue's total utility from golf and tennis. If the price of each hour of golf is twice the price of each hour of tennis, and Sue plays four hours of tennis, then Sue plays

Suppose Hank spends his entire budget buying 2 bagels and 3 cups of coffee each day. Also, suppose the marginal utility of the second bagel is 100 and the marginal utility of the third cup of coffee is 200. Which of the following statements is TRUE?

-The table above gives Jane's total utility from magazines and CDs. The price of a magazine is $4 and the price of a CD is $10 and Jane's budget is $88. What is Jane's total utility when she maximizes her utility?

At 37, actor Matthew McConaughey said he only needed "friends and family" to keep him happy and that he avoided "false drama" at all costs. How did you maintain that bod? "I don't really have a workout regimen I follow. I just live my life. My goal is to break a sweat each day." People June 25, 2007 Mr. McConaughey said he only needed friends and family and to break a sweat each day to keep him happy. The table above shows the total utility he gets from spending time with friends and family and breaking a sweat. -Mr. McConaughey has the afternoon, 5 hours, to spend doing whatever he wants. How much time does Mr. McConaughey spend with his friends and family and how much time does he spend breaking a sweat to maximize his total utility?

-Steve has two goods he can spend his income on, skiing and skating, and his marginal utilities from each are in the table above. The price of each unit of skiing is $10 and the price of each unit of skating is $10. Steve has $40 to spend. What quantities of skiing and ice skating will Steve consume to maximize his utility?

The paradox of value is illustrated by the fact that

At Revolution Doughnuts in Fort Collins, Colorado, a cup of coffee or a doughnut is $1. Suppose Hannah loves going to Revolution Doughnuts and usually buys 2 doughnuts and 1 cup of coffee. On the way to the shop, Hannah finds an extra $2 dollars in change in her car and buys an extra doughnut and cup of coffee. This means

Total utility from -Marginal utility theory is used in the derivation of the

-The table above gives Cathy's total utility from Mt. Dew. If the price of a Mt. Dew is $1.50, Cathy's marginal utility per dollar from the 4th Mt. Dew is ________ units per dollar.

Explain the concept of consumer equilibrium.

If Pete enjoys his first pancake of the morning much more than his fifth pancake of the morning, he is exhibiting

Roberta spends all of her income on two items, staplers and paper clips. If the price of a stapler increases, there will be a ________ Roberta's demand curve for staplers and a ________ Roberta's demand curve for paper clips.

When Tom's income increases, his demand curve for Mountain Dew shifts rightward because the higher income increases his marginal utility of Mountain Dew.

A consumer has maximized his or her utility by consuming

Apples Tacos -Sally derives utility from consuming apples and tacos as shown in the table above. Apples cost $1 each and tacos cost $2 each. If Sally's income is $9, she will consume

Fred spends all of his income on two goods: DVDs and downloaded music. If Fred's marginal utility per dollar from DVDs is greater than his marginal utility per dollar from downloaded music, Fred can ________ his total utility by buying ________.

Pizza CDs -Bobby spends $100 per month on pizza and CDs. His utility from these goods is shown in the table above. The price of a pizza is $10 and the price of a CD is $20. If Bobby maximizes utility from these goods, his total utility is ________ units.

Mark's marginal utility from reading books is the ________ when he reads ________.

The diamond-water paradox of value can be explained by

-Lisa spends all her income on pizzas and DVDs. The above table shows Lisa's marginal utility for pizza and marginal utility for DVDs. If the price of a pizza is $10 and the price of a DVD is $10 and Lisa has $60 to spend on the two goods, what combination of pizza and DVDs will maximize her utility?