Exam 8: Utility and Demand

-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.

A consumer will maximize utility when all income is spent and the marginal utility is equal for all goods.

-The above table shows Homer's utility from boxes of doughnuts. The marginal utility that Homer receives from the third box of doughnuts is equal to

Sarah consumes only strawberries and cream, and she is spending all of her income. Her marginal utility of her last dish of strawberries is 200 and her marginal utility of her last pint of cream is 200. The price of strawberries is $1.00 per dish and the price of cream is $2.00 per pint. To maximize her utility, Sarah should

Fritos Fruit drinks -The table above shows the total utility from the two goods Freddy likes to consume. If Freddy has consumed 4 fruit drinks and then decides to drink another

-Suppose that you consume only pizza and Diet Pepsi. The table above gives your utility from consuming these two goods. What is the marginal utility you get from the fourth slice of pizza?

-Julie's total utility from cheeseburgers is given in the table above. What is the marginal utility of the third cheeseburger?

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, 2007Mr. 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?

Suppose Jenny's marginal utility of fish is 40 and her marginal utility from chips is 20. The price of fish is $10 and the price of chips is $1. What should Jenny do to maximize her utility? Explain your answer.

Does the fact that diamonds are so expensive imply that the demand curve for diamonds has a positive slope? Use marginal utility theory to answer the question.

If a consumer spends all of his or her income and the marginal utility per dollar is equal for all goods, then

Milkshakes Sodas -The table above shows Tom's total utility from milkshakes and sodas. Tom's total budget for milkshakes and sodas is $10.00 per week. Milkshakes cost $2.00 each and sodas cost $1.00 each. What quantity of milkshakes does Tom purchase at his consumer equilibrium?

-Becky decides to spend $50 per month on DVD rentals and movie tickets. Her marginal utility schedules from these two goods are shown in the table above. The price of a DVD rental is $2.50, and the price of a movie ticket is $5. Becky maximizes her utility if she rents ________ DVDs per month and buys ________ movie tickets per month.

Because we cannot observe or measure utility

Water has a ________ marginal utility and brings a ________ consumer surplus; diamonds have a ________ marginal utility and bring a ________ consumer surplus.

If it costs $6.00 to go to the movies and $25.00 to go to a hockey game, Tom is maximizing his utility between movies and hockey if his marginal utility of movies is 12 units and his marginal utility from hockey is 50.

-The above table shows Tammy's total utility from videos and CDs. If Tammy has $110 to spend on videos and CDs and if the price of a video is $10 and the price of a CD is $20, then the maximum utility Tammy can attain is

Marginal utility theory concludes that a decrease in the price of a good increases the quantity demanded and

According to a behavioral economist, people who are unwilling to sell the last pound of rice they purchased for the same price that they paid for it are displaying ________.

Is "utility" another word for the cost we give up when we consume a good?