Exam 5: Consumer Choice: Individual and Market Demand

Bobby is buying slices of pizza and place a value of his utility of the first slice at $5; a second slice at $4, and a third slice at $2.If Bobby eats three slices of pizza for lunch, his total utility is equal to

The slope of an indifference curve at all points reflects

Total utility decreases when diminishing marginal utility is present.

Which of the following statements is correct?

A bottle of wine costs $8 and a quiche costs $5.At Robert's present levels of consumption, he spends all his income and receives marginal utility of $10 from the last bottle of wine and marginal utility of $4 from the last quiche.To maximize his total utility, Robert should

Figure 5-3 -Market demand curves may slope downward even if some individual demand curves do not because

-Americans choose cola over other flavors 70 percent of the time.Analysts say this is because cola's flavor is more robust and durable.Orange soda, for example, suffers from flavor fatigue faster than cola.Also, because cola contains caffeine, people may be addicted to the stimulant.Which panel in Figure 5-1 best illustrates these facts?

Even if all individual demand curves are downwardly sloped, the market demand curve may slope upward.

Figure 5-16 -Vicki consumes meat loaf and pizza.To keep her utility constant, you must give her more of one good if you take some of the other away.This information implies that

Figure 5-16 -In Figure 5-16, a decrease in the price of apples will

In Poland's free market, Felix Siemienas is making a fortune in cold cuts.Prices are much higher than formerly.Siemienas says, "Yes, my prices are high.If nobody buys, I bring my prices down.That is the market rule." This "rule" best describes

Which of the following factors is always present in consumer decision making?

When a consumer has chosen an optimal bundle of goods, this bundle maximizes marginal utility.

The law of demand ensures that a demand curve has a positive slope.

Plot the demand for caviar given the following information on quantity consumed and total utility; then explain why caviar sells for such a high price. ​

If the demand curve for an inferior good is drawn,

A consumer possesses five pounds of bananas and values their total utility at $2.14.If one additional pound is acquired and marginal utility is 11 cents, total utility will

Figure 5-3 -In Figure 5-3, a decline in price from 3 to 1 will increase market quantity demanded by

The law of diminishing marginal utility guarantees that demand curves will have positive slopes.

According to the "law" of demand, we would expect