Question 1

A relative price is the

Accepted Answer

A)  price of a substitute. 
B)  price of a related good. 
C)  price of one good divided by the price of another. 
D)  absolute price of a good. 
E)  price of one good multiplied by the price of another. 
A)  price of a substitute. 
B)  price of a related good. 
C)  price of one good divided by the price of another. 
D)  absolute price of a good. 
E)  price of one good multiplied by the price of another.

Question 2

A preference map is a

Accepted Answer

A)  series of indifference curves. 
B)  positively sloped series of curves, which reflect a consumer's preferences. 
C)  contour map of a consumer's budget. 
D)  map showing how much a consumer prefers one good for another. 
E)  None of the above answers is correct. 
A)  series of indifference curves. 
B)  positively sloped series of curves, which reflect a consumer's preferences. 
C)  contour map of a consumer's budget. 
D)  map showing how much a consumer prefers one good for another. 
E)  None of the above answers is correct.

Question 3

The magnitude of the slope of an indifference curve is the

Accepted Answer

A)  marginal rate of substitution. 
B)  rate of relative prices. 
C)  marginal utility of substitution. 
D)  marginal rate of utility of income. 
E)  rate of increasing opportunity cost. 
A)  marginal rate of substitution. 
B)  rate of relative prices. 
C)  marginal utility of substitution. 
D)  marginal rate of utility of income. 
E)  rate of increasing opportunity cost.

Question 4

________ leads to a decrease in marginal utility per dollar for soda.

Accepted Answer

A)  Increasing marginal utility 
B)  The diminishing marginal rate of substitution as fewer sodas are consumed 
C)  An outward shift in the indifference curves for soda 
D)  An increase in the price of soda 
E)  A fall in the price of soda 
A)  Increasing marginal utility 
B)  The diminishing marginal rate of substitution as fewer sodas are consumed 
C)  An outward shift in the indifference curves for soda 
D)  An increase in the price of soda 
E)  A fall in the price of soda

Question 5

13.6 Appendix Figures
   
The figure above shows three of a consumer's indifference curves.
-Which point is most preferred?

Accepted Answer

A)  Point C only. 
B)  Point J only. 
C)  Point G only. 
D)  Point C and G are tied for the most preferred. 
E)  More information is needed to determine which point is most preferred. 
A)  Point C only. 
B)  Point J only. 
C)  Point G only. 
D)  Point C and G are tied for the most preferred. 
E)  More information is needed to determine which point is most preferred.

Question 6

Sam's budget is $60.00.The combinations of gasoline and coffee along one of Sam's indifference curves are combinations

Accepted Answer

A)  that require the same total expenditure. 
B)  that he can afford with his $60.00 budget. 
C)  among which he is indifferent. 
D)  that give him the same marginal rate of substitution. 
E)  None of the above answers are correct. 
A)  that require the same total expenditure. 
B)  that he can afford with his $60.00 budget. 
C)  among which he is indifferent. 
D)  that give him the same marginal rate of substitution. 
E)  None of the above answers are correct.

Question 7

If you get 40 units of utility from eating the first bag of pretzels,30 from the second bag,and 20 from the third bag,the total utility of three bags of pretzels is ________ units of utility.

Accepted Answer

A)  40 
B)  70 
C)  90 
D)  50 
E)  20 
A)  40 
B)  70 
C)  90 
D)  50 
E)  20

Question 8

"Every point on a budget line has an indifference curve passing through it." Explain if the previous statement is correct or not.

Accepted Answer

The statement is correct.The c

Question 9

If a consumer's total utility increases when another unit of a good is consumed,which of the following is true? Marginal utility must be

Accepted Answer

A)  negative. 
B)  equal to one. 
C)  positive. 
D)  increasing. 
E)  some amount, but more information is needed to determine if marginal utility is positive, negative, or equal to zero. 
A)  negative. 
B)  equal to one. 
C)  positive. 
D)  increasing. 
E)  some amount, but more information is needed to determine if marginal utility is positive, negative, or equal to zero.

Question 10

When Chris maximizes his total utility,then his entire available budget is allocated in such a way that the

Accepted Answer

A)  marginal utility of all goods is equal. 
B)  marginal utility per dollar is equal for all goods. 
C)  marginal utility is as large as possible for goods. 
D)  marginal utility will start decreasing if it consumes fewer goods. 
E)  quantities consumed of each good are equal. 
A)  marginal utility of all goods is equal. 
B)  marginal utility per dollar is equal for all goods. 
C)  marginal utility is as large as possible for goods. 
D)  marginal utility will start decreasing if it consumes fewer goods. 
E)  quantities consumed of each good are equal.

Question 11

If Sarah gets 40 units of utility from her first piece of toast for breakfast and a total of 70 units from two pieces of toast,then the marginal utility of the first piece is ________ units and the marginal utility of the second piece is ________ units.

Accepted Answer

A)  40; 70 
B)  40; 110 
C)  40; 30 
D)  40; 35 
E)  70; 40 
A)  40; 70 
B)  40; 110 
C)  40; 30 
D)  40; 35 
E)  70; 40

Question 12

"As Mike consumes more dates over the course of a day,it is likely that his marginal rate of substitution of dates for other goods will rise." Is the previous statement correct or incorrect?

Accepted Answer

The statement is incorrect.The principle

Question 13

The figure above shows three budget lines.
-Based on the figure above,on which budget line is the relative price of gum the highest?

Accepted Answer

A)  Budget line BL₂. 
B)  Budget line BL₀. 
C)  Budget line BL₁. 
D)  The relative price is the same along all three budget lines. 
E)  To answer the question, more information is needed about the consumer's income. 
A)  Budget line BL₂. 
B)  Budget line BL₀. 
C)  Budget line BL₁. 
D)  The relative price is the same along all three budget lines. 
E)  To answer the question, more information is needed about the consumer's income.

Question 14

-The figure above shows Sarah's budget line.Sarah earns $500 per week selling baskets made out of tree vines.With this money she buys sushi and rose bushes.Each piece of sushi costs $1 and each rose bush costs $10.Sarah will be at what point on her budget line if she spends $200 per week on sushi?

Accepted Answer

A)  Point a 
B)  Point b 
C)  Point c 
D)  Point f 
E)  Point d 
A)  Point a 
B)  Point b 
C)  Point c 
D)  Point f 
E)  Point d

Question 15

The point where the budget line intersects the y-axis represents a combination of goods that contains

Accepted Answer

A)  some of both goods. 
B)  only the good measured on the y-axis. 
C)  only the good measured on the x-axis. 
D)  no goods. 
E)  the quantity of the good measured on the y-axis that has zero marginal utility. 
A)  some of both goods. 
B)  only the good measured on the y-axis. 
C)  only the good measured on the x-axis. 
D)  no goods. 
E)  the quantity of the good measured on the y-axis that has zero marginal utility.

Question 16

The indifference curve/budget line diagram concludes that Jim is definitely in equilibrium when he is

Accepted Answer

A)  spending all his budget. 
B)  saving some of his budget. 
C)  consuming the combination of goods and services that is affordable and on the highest attainable indifference curve. 
D)  consuming a combination of goods and services that is on an indifference curve. 
E)  None of the above answers is correct. 
A)  spending all his budget. 
B)  saving some of his budget. 
C)  consuming the combination of goods and services that is affordable and on the highest attainable indifference curve. 
D)  consuming a combination of goods and services that is on an indifference curve. 
E)  None of the above answers is correct.

Question 17

When the price of one good changes while another good's price does not change,then there has been a change in the

Accepted Answer

A)  relative price. 
B)  marginal utility price. 
C)  absolute price. 
D)  marginal price. 
E)  utility price. 
A)  relative price. 
B)  marginal utility price. 
C)  absolute price. 
D)  marginal price. 
E)  utility price.

Question 18

Diminishing marginal utility means that as more of a good is consumed,

Accepted Answer

A)  the price of the good rises. 
B)  the price of the good falls. 
C)  more income is spent. 
D)  the utility of an additional unit decreases. 
E)  the consumption of some other good must diminish. 
A)  the price of the good rises. 
B)  the price of the good falls. 
C)  more income is spent. 
D)  the utility of an additional unit decreases. 
E)  the consumption of some other good must diminish.

Question 19

The marginal rate of substitution (MRS)at point G equals

Accepted Answer

A)  4. 
B)  8. 
C)  2. 
D)  1/2. 
E)  More information is needed to calculate the MRS. 
A)  4. 
B)  8. 
C)  2. 
D)  1/2. 
E)  More information is needed to calculate the MRS.

Question 20

A budget line shows the

Accepted Answer

A)  quantities of goods a buyer can purchase with given income and prices. 
B)  relationship between price and quantity demanded. 
C)  total utility a consumer realizes from consuming different quantities of a good. 
D)  quantities of consumption that maximizes marginal utility. 
E)  the prices of the two goods a buyer can purchase. 
A)  quantities of goods a buyer can purchase with given income and prices. 
B)  relationship between price and quantity demanded. 
C)  total utility a consumer realizes from consuming different quantities of a good. 
D)  quantities of consumption that maximizes marginal utility. 
E)  the prices of the two goods a buyer can purchase.

A relative price is the

A preference map is a

The magnitude of the slope of an indifference curve is the

________ leads to a decrease in marginal utility per dollar for soda.

13.6 Appendix Figures The figure above shows three of a consumer's indifference curves. -Which point is most preferred?

Sam's budget is $60.00.The combinations of gasoline and coffee along one of Sam's indifference curves are combinations

If you get 40 units of utility from eating the first bag of pretzels,30 from the second bag,and 20 from the third bag,the total utility of three bags of pretzels is ________ units of utility.

"Every point on a budget line has an indifference curve passing through it." Explain if the previous statement is correct or not.

If a consumer's total utility increases when another unit of a good is consumed,which of the following is true? Marginal utility must be

When Chris maximizes his total utility,then his entire available budget is allocated in such a way that the

If Sarah gets 40 units of utility from her first piece of toast for breakfast and a total of 70 units from two pieces of toast,then the marginal utility of the first piece is units and the marginal utility of the second piece is units.

"As Mike consumes more dates over the course of a day,it is likely that his marginal rate of substitution of dates for other goods will rise." Is the previous statement correct or incorrect?

The figure above shows three budget lines. -Based on the figure above,on which budget line is the relative price of gum the highest?

-The figure above shows Sarah's budget line.Sarah earns $500 per week selling baskets made out of tree vines.With this money she buys sushi and rose bushes.Each piece of sushi costs $1 and each rose bush costs $10.Sarah will be at what point on her budget line if she spends $200 per week on sushi?

The point where the budget line intersects the y-axis represents a combination of goods that contains

The indifference curve/budget line diagram concludes that Jim is definitely in equilibrium when he is

When the price of one good changes while another good's price does not change,then there has been a change in the

Diminishing marginal utility means that as more of a good is consumed,

The marginal rate of substitution (MRS)at point G equals

A budget line shows the

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets With Private Information

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 13: Consumer Choice and Demand

A relative price is the

A preference map is a

The magnitude of the slope of an indifference curve is the

________ leads to a decrease in marginal utility per dollar for soda.

13.6 Appendix Figures The figure above shows three of a consumer's indifference curves. -Which point is most preferred?

Sam's budget is $60.00.The combinations of gasoline and coffee along one of Sam's indifference curves are combinations

If you get 40 units of utility from eating the first bag of pretzels,30 from the second bag,and 20 from the third bag,the total utility of three bags of pretzels is ________ units of utility.

"Every point on a budget line has an indifference curve passing through it." Explain if the previous statement is correct or not.

If a consumer's total utility increases when another unit of a good is consumed,which of the following is true? Marginal utility must be

When Chris maximizes his total utility,then his entire available budget is allocated in such a way that the

If Sarah gets 40 units of utility from her first piece of toast for breakfast and a total of 70 units from two pieces of toast,then the marginal utility of the first piece is ________ units and the marginal utility of the second piece is ________ units.

"As Mike consumes more dates over the course of a day,it is likely that his marginal rate of substitution of dates for other goods will rise." Is the previous statement correct or incorrect?

The figure above shows three budget lines. -Based on the figure above,on which budget line is the relative price of gum the highest?

-The figure above shows Sarah's budget line.Sarah earns $500 per week selling baskets made out of tree vines.With this money she buys sushi and rose bushes.Each piece of sushi costs $1 and each rose bush costs $10.Sarah will be at what point on her budget line if she spends $200 per week on sushi?

The point where the budget line intersects the y-axis represents a combination of goods that contains

The indifference curve/budget line diagram concludes that Jim is definitely in equilibrium when he is

When the price of one good changes while another good's price does not change,then there has been a change in the

Diminishing marginal utility means that as more of a good is consumed,

The marginal rate of substitution (MRS)at point G equals

A budget line shows the

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets With Private Information

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

If Sarah gets 40 units of utility from her first piece of toast for breakfast and a total of 70 units from two pieces of toast,then the marginal utility of the first piece is units and the marginal utility of the second piece is units.