Question 1

Refer to the accompanying table. The marginal utility of consuming apples is: $$\begin{array} { | c | c | } 
\hline \text { Number of Apples } & \begin{array} { c } 
\text { Tatal } \
\text { Utility }
\end{array} \
\hline 1 &20 \
\hline 2 & 35 \
\hline 3 & 45 \
\hline 4 & 50 \
\hline 5 & 45 \
\hline
\end{array}$$

Accepted Answer

A) constant. 
B) first increasing, but decreasing after the fourth apple. 
C) decreasing after the first apple. 
D) constantly increasing. 
A) constant. 
B) first increasing, but decreasing after the fourth apple. 
C) decreasing after the first apple. 
D) constantly increasing.

Question 2

The accompanying figure shows a single consumer's demand for ice cream at the student union.   An increase in the number of students on this campus would cause:

Accepted Answer

A) the demand curve shown above to shift to the right. 
B) the demand curve shown above to shift to the left. 
C) the market demand curve for ice cream from the student union to shift to the right. 
D) no change in the market demand curve for ice cream from the student union. 
A) the demand curve shown above to shift to the right. 
B) the demand curve shown above to shift to the left. 
C) the market demand curve for ice cream from the student union to shift to the right. 
D) no change in the market demand curve for ice cream from the student union.

Question 3

Refer to the accompanying table. The marginal utility of the 3?? dinner is: $\begin{array}{|c|c|c|}
\begin{array}{c}
\text { Number of Dinners } \
\text { Out Per Week }
\end{array} & \text { Total Utility } & \text { Marginal Utility } \
\hline 1 & 100 \
\hline 2 & & 75\
\hline 3 & 235 & \
\hline 4 & 250 & \
\hline
\end{array}$

Accepted Answer

A) 60. 
B) 75. 
C) 135. 
D) 160. 
A) 60. 
B) 75. 
C) 135. 
D) 160.

Question 4

If Terry's total utility is maximized when he owns 10 pairs of shoes, then Terry's total utility from owning 7 pairs of shoes is ________ Terry's total utility from owning 8 pairs.

Accepted Answer

A) greater than 
B) equal to 
C) less than 
D) less than or equal to 
A) greater than 
B) equal to 
C) less than 
D) less than or equal to

Question 5

Refer to the accompanying table. The marginal utility of consuming the 2?? apple is: $$\begin{array} { | c | c | } 
\hline \text { Number of Apples } & \begin{array} { c } 
\text { Tatal } \
\text { Utility }
\end{array} \
\hline 1 &20 \
\hline 2 & 35 \
\hline 3 & 45 \
\hline 4 & 50 \
\hline 5 & 45 \
\hline
\end{array}$$

Accepted Answer

A) 35. 
B) 10. 
C) 15. 
D) 20. 
A) 35. 
B) 10. 
C) 15. 
D) 20.

Question 6

You are trying to decide how to spend your last lunch dollar. You should use that dollar to buy more of the item:

Accepted Answer

A) that costs the least. 
B) that gives you the highest average utility per dollar. 
C) that gives you the highest marginal utility per dollar. 
D) from which you already have gained the greatest total utility. 
A) that costs the least. 
B) that gives you the highest average utility per dollar. 
C) that gives you the highest marginal utility per dollar. 
D) from which you already have gained the greatest total utility.

Question 7

The accompanying figure shows the annual demand for haircuts for one person in the town of Beaumont. There are a total of 300 residents in Beaumont, each with this same demand curve.   If the residents of Beaumont purchase a total of 1,800 haircuts each year, then the market price for a haircut must be:

Accepted Answer

A) $40. 
B) $35. 
C) $30. 
D) $20. 
A) $40. 
B) $35. 
C) $30. 
D) $20.

Question 8

Refer to the accompanying figure. The total utility of consuming two pizzas a week is:

Accepted Answer

A) 25 
B) 30 
C) 55 
D) 75 
A) 25 
B) 30 
C) 55 
D) 75

Question 9

Refer to the accompanying figure. The total utility of consuming 4 pizzas a week is:

Accepted Answer

A) 15 
B) 22.5 
C) 75 
D) 90 
A) 15 
B) 22.5 
C) 75 
D) 90

Question 10

If a consumer buys two different goods, the rational spending rule requires that the:

Accepted Answer

A) total expenditure on the two goods be equal. 
B) ratio of total utility to price be equal for the two goods. 
C) ratio of average utility to price be equal for the two goods. 
D) ratio of marginal utility to price be equal for the two goods. 
A) total expenditure on the two goods be equal. 
B) ratio of total utility to price be equal for the two goods. 
C) ratio of average utility to price be equal for the two goods. 
D) ratio of marginal utility to price be equal for the two goods.

Question 11

Refer to the accompanying figure.   If Zeynep's current budget constraint is BC2, and her budget for ham sandwiches and cheese sandwiches is $120, then the price of a cheese sandwich is:

Accepted Answer

A) $2. 
B) $6. 
C) $9. 
D) $12. 
A) $2. 
B) $6. 
C) $9. 
D) $12.

Question 12

Suppose the market for shoes consists of three consumers. The accompanying table shows the quantity demanded at various prices for each consumer: $$\begin{array} { | c | r | r | r | } 
\hline \begin{array} { c } 
\text { Price } \
\text { Per Pair }
\end{array} & \begin{array} { c } 
\text { Pairs Demanded } \
\text { by Pat }
\end{array} & \begin{array} { c } 
\text { Pairs Demanded } \
\text { by Leigh }
\end{array} & \begin{array} { c } 
\text { Pairs Demanded } \
\text { by Chris }
\end{array} \
\hline \$ 100 & \mathbb { 0 } & 1 & 0 \
\hline \$ 75 & 0 & 3 & 1 \
\hline \$ 50 & 1 & 7 & 3 \
\hline \$ 30 & 2 & 10 & 5 \
\hline
\end{array}$$  
What is the market demand for shoes when the price is $50 a pair?

Accepted Answer

A) 7 pairs 
B) 11 pairs 
C) 15 pairs 
D) It will depend on the quantity supplied when the price is $50 a pair. 
A) 7 pairs 
B) 11 pairs 
C) 15 pairs 
D) It will depend on the quantity supplied when the price is $50 a pair.

Question 13

When Lorenzo eats 1 slice of pizza for lunch, his total utility is 23, and when he eats 2 slices of pizza for lunch, his total utility is 42. Assuming that Lorenzo's marginal utility from eating pizza is always positive, we can infer that his total utility from eating 3 slices of pizza at lunch is:

Accepted Answer

A) greater than 42 and less than 84. 
B) greater than 42 and less than 46. 
C) greater than 42 and less than 61. 
D) greater than 23 and less than 42. 
A) greater than 42 and less than 84. 
B) greater than 42 and less than 46. 
C) greater than 42 and less than 61. 
D) greater than 23 and less than 42.

Question 14

Refer to the accompanying table. The marginal utility of the 4?? dinner out per week is:  
$\begin{array}{|c|c|c|}
\begin{array}{c}
\text { Number of Dinners } \
\text { Out Per Week }
\end{array} & \text { Total Utility } & \text { Marginal Utility } \
\hline 1 & 100 \
\hline 2 & & 75\
\hline 3 & 235 & \
\hline 4 & 250 & \
\hline
\end{array}$

Accepted Answer

A) 75. 
B) 60. 
C) 250. 
D) 15. 
A) 75. 
B) 60. 
C) 250. 
D) 15.

Question 15

The accompanying figure shows the demand curve for a product that can be sold only in whole-number amounts.   What is the maximum price that any buyer would be willing to pay for the first unit?

Accepted Answer

A) 40 
B) 35 
C) 25 
D) 15 
A) 40 
B) 35 
C) 25 
D) 15

Question 16

At his current level of consumption, Cameron gets 3 times more marginal utility from an additional game of pinball than from an additional game of ping pong. If the price of a ping pong game is $0.50, then he is maximizing utility if the price of a pinball game is:

Accepted Answer

A) $1.00 
B) $1.50 
C) $2.00 
D) $3.00 
A) $1.00 
B) $1.50 
C) $2.00 
D) $3.00

Question 17

Assume that Dusty has $30 in income, the price of a loaf of bread is $1.50, and the price of a jar of peanut butter is $3. Suppose that at the original income of $30, the price of a loaf of bread increased to $3 and the price of a jar of peanut butter decreased to $2. Dusty can buy a maximum of ________ loaves of bread or a maximum of ________ jars of peanut butter.

Accepted Answer

A) 10; 15 
B) 15; 10 
C) 20; 15 
D) 15; 20 
A) 10; 15 
B) 15; 10 
C) 20; 15 
D) 15; 20

Question 18

According to the law of diminishing marginal utility:

Accepted Answer

A) as you consume less of something, your total utility will decrease. 
B) as you consume less of something, your marginal utility from consuming that good will increase. 
C) you should never consume more of something if your marginal utility is decreasing. 
D) if your total utility is increasing as you consume more of something, then your marginal utility must be increasing as well. 
A) as you consume less of something, your total utility will decrease. 
B) as you consume less of something, your marginal utility from consuming that good will increase. 
C) you should never consume more of something if your marginal utility is decreasing. 
D) if your total utility is increasing as you consume more of something, then your marginal utility must be increasing as well.

Question 19

Suppose the market for shoes consists of three consumers. The accompanying table shows the quantity demanded at various prices for each consumer: $$\begin{array} { | c | r | r | r | } 
\hline \begin{array} { c } 
\text { Price } \
\text { Per Pair }
\end{array} & \begin{array} { c } 
\text { Pairs Demanded } \
\text { by Pat }
\end{array} & \begin{array} { c } 
\text { Pairs Demanded } \
\text { by Leigh }
\end{array} & \begin{array} { c } 
\text { Pairs Demanded } \
\text { by Chris }
\end{array} \
\hline \$ 100 & \mathbb { 0 } & 1 & 0 \
\hline \$ 75 & 0 & 3 & 1 \
\hline \$ 50 & 1 & 7 & 3 \
\hline \$ 30 & 2 & 10 & 5 \
\hline
\end{array}$$ At $100 per pair, market demand:

Accepted Answer

A) intersects the y-axis. 
B) intersects the x-axis. 
C) is the same as Leigh's demand. 
D) is less than the quantity supplied. 
A) intersects the y-axis. 
B) intersects the x-axis. 
C) is the same as Leigh's demand. 
D) is less than the quantity supplied.

Question 20

Assume that Dusty has $30 in income, the price of a loaf of bread is $1.50, and the price of a jar of peanut butter is $3. If Dusty's income rises to $45, Dusty can now buy a maximum of ________ loaves of bread or a maximum of ________ jars of peanut butter.

Accepted Answer

A) 5; 25 
B) 10; 40 
C) 15; 30 
D) 30; 15 
A) 5; 25 
B) 10; 40 
C) 15; 30 
D) 30; 15

Exam 5: Demand

Refer to the accompanying table. The marginal utility of consuming apples is: Number of Apples Tatal Utility 1 20 2 35 3 45 4 50 5 45

The accompanying figure shows a single consumer's demand for ice cream at the student union. An increase in the number of students on this campus would cause:

Refer to the accompanying table. The marginal utility of the 3?? dinner is: Number of Dinners Out Per Week Total Utility Marginal Utility 1 100 2 75 3 235 4 250

If Terry's total utility is maximized when he owns 10 pairs of shoes, then Terry's total utility from owning 7 pairs of shoes is ________ Terry's total utility from owning 8 pairs.

Refer to the accompanying table. The marginal utility of consuming the 2?? apple is: Number of Apples Tatal Utility 1 20 2 35 3 45 4 50 5 45

You are trying to decide how to spend your last lunch dollar. You should use that dollar to buy more of the item:

Refer to the accompanying figure. The total utility of consuming two pizzas a week is:

Refer to the accompanying figure. The total utility of consuming 4 pizzas a week is:

If a consumer buys two different goods, the rational spending rule requires that the:

Refer to the accompanying figure. If Zeynep's current budget constraint is BC2, and her budget for ham sandwiches and cheese sandwiches is $120, then the price of a cheese sandwich is:

When Lorenzo eats 1 slice of pizza for lunch, his total utility is 23, and when he eats 2 slices of pizza for lunch, his total utility is 42. Assuming that Lorenzo's marginal utility from eating pizza is always positive, we can infer that his total utility from eating 3 slices of pizza at lunch is:

Refer to the accompanying table. The marginal utility of the 4?? dinner out per week is: Number of Dinners Out Per Week Total Utility Marginal Utility 1 100 2 75 3 235 4 250

The accompanying figure shows the demand curve for a product that can be sold only in whole-number amounts. What is the maximum price that any buyer would be willing to pay for the first unit?

At his current level of consumption, Cameron gets 3 times more marginal utility from an additional game of pinball than from an additional game of ping pong. If the price of a ping pong game is $0.50, then he is maximizing utility if the price of a pinball game is:

According to the law of diminishing marginal utility:

Assume that Dusty has $30 in income, the price of a loaf of bread is $1.50, and the price of a jar of peanut butter is $3. If Dusty's income rises to $45, Dusty can now buy a maximum of ________ loaves of bread or a maximum of ________ jars of peanut butter.

Thinking Like an Economist

Comparative Advantage

Supply and Demand

Elasticity

Perfectly Competitive Supply

Efficiency, Exchange, and the Invisible Hand in Action

Monopoly, Oligopoly, and Monopolistic Competition

Games and Strategic Behavior

An Introduction to Behavioral Economics

Externalities, Property Rights, and the Environment

The Economics of Information

Labor Markets, Poverty, and Income Distribution

Public Goods and Tax Policy

International Trade and Trade Policy

Macroeconomics: The Birds Eye View of the Economy

Measuring Economic Activity: GDP and Unemployment

Measuring the Price Level and Inflation

Economic Growth, Productivity, and Living Standards

The Labor Market: Workers, Wages, and Unemployment

Saving and Capital Formation

Money Prices and the Federal Reserve

Financial Markets and International Capital Flows

Short-Term Economic Fluctuations: An Introduction

Spending and Output in the Short Run

Stabilizing the Economy: The Role of the Fed

Aggregate Demand, Aggregate Supply, and Inflation

Exchange Rates and the Open Economy

Filters

Assume that Dusty has $30 in income, the price of a loaf of bread is $1.50, and the price of a jar of peanut butter is $3. If Dusty's income rises to $45, Dusty can now buy a maximum of loaves of bread or a maximum of jars of peanut butter.