Question 1

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

Accepted Answer

A)  change in his total utility; one additional book 
B)  total utility he gets; one more book 
C)  change in his total utility; more books 
D)  consumer surplus he gets; books 
A)  change in his total utility; one additional book 
B)  total utility he gets; one more book 
C)  change in his total utility; more books 
D)  consumer surplus he gets; books

Question 2

A consumer's total utility is maximized when the total utility per dollar from all goods is equalized.

Accepted Answer

A) True 
 B)False

Question 3

Keesha consumes only milkshakes and burgers. At her consumer equilibrium, which of the following is TRUE when Keesha can buy any portion of a unit of a milkshake or burger?

Accepted Answer

A)  The marginal utility per dollar from a milkshake will exceed the marginal utility per dollar from a burger if she likes burgers more than milkshakes. 
B)  The marginal utility per dollar from a burger will exceed the marginal utility per dollar from a milkshake if she likes burgers more than milkshakes. 
C)  The marginal utility per dollar will be the same for each good. 
D)  The marginal utility will be the same for each good. 
A)  The marginal utility per dollar from a milkshake will exceed the marginal utility per dollar from a burger if she likes burgers more than milkshakes. 
B)  The marginal utility per dollar from a burger will exceed the marginal utility per dollar from a milkshake if she likes burgers more than milkshakes. 
C)  The marginal utility per dollar will be the same for each good. 
D)  The marginal utility will be the same for each good.

Question 4

The marginal utility of a third skirt is

Accepted Answer

A)  three times the average utility of the three skirts. 
B)  three skirts times the price of a skirt. 
C)  the total utility of three skirts divided by three. 
D)  the change in total utility from the third skirt. 
A)  three times the average utility of the three skirts. 
B)  three skirts times the price of a skirt. 
C)  the total utility of three skirts divided by three. 
D)  the change in total utility from the third skirt.

Question 5

-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. Suppose Becky rents 8 DVDs and buys 6 movie tickets per month. She

Accepted Answer

A)  cannot increase her total utility because she already gets the maximum possible utility from DVD rentals and movies within her budget. 
B)  can increase her total utility if she rents more DVDs and buys more movie tickets. 
C)  can increase her total utility if she rents more DVDs and buys fewer movie tickets. 
D)  can increase her total utility if she rents fewer DVDs and buys more movie tickets. 
A)  cannot increase her total utility because she already gets the maximum possible utility from DVD rentals and movies within her budget. 
B)  can increase her total utility if she rents more DVDs and buys more movie tickets. 
C)  can increase her total utility if she rents more DVDs and buys fewer movie tickets. 
D)  can increase her total utility if she rents fewer DVDs and buys more movie tickets.

Question 6

If the price of a good increases, all else the same, then the consumer's total utility will

Accepted Answer

A)  increase. 
B)  decrease. 
C)  remain the same as consumption shifts to cheaper goods. 
D)  decrease if there are no substitutes for the good and remain the same if there are substitutes for the good. 
A)  increase. 
B)  decrease. 
C)  remain the same as consumption shifts to cheaper goods. 
D)  decrease if there are no substitutes for the good and remain the same if there are substitutes for the good.

Question 7

Ice cream Romance novels  
-The table above shows Danielle's utility from ice cream and romance novels.
a) What is Danielle's marginal utility from the 4th novel?
b) The price of ice cream is $5 per gallon and a novel is $10. If Danielle's budget for these two goods is $50 and she buys 2 gallons of ice cream, how many novels can she buy? If she buys 6 gallons of ice cream, what is her marginal utility per dollar spent on novels?
c) Which combination of the two goods is better: 4 gallons of ice cream and 3 novels or 6 gallons of ice cream and 2 novels?

Accepted Answer

a) Danielle's marginal utility from the

Question 8

If Mark's marginal utility per dollar spent on the last taco is 15 and his marginal utility per dollar spent on the last burrito is 20 units, what should Mark do to increase his total utility?

Accepted Answer

Mark should buy more burritos and fewer

Question 9

Cookies Cake  
-The above table shows Homer's marginal utility from consuming various quantities of chocolate chip cookies and cake. The price of cookies is $2 per pound, the price of cake is $2 per slice and Homer has $12 to spend on cookies and cake. Homer will consume ________ of cookies and ________ of cake.

Accepted Answer

A)  1 pound; 5 slices 
B)  2 pounds; 4 slices 
C)  3 pounds; 3 slices 
D)  5 pounds; 2 slices 
A)  1 pound; 5 slices 
B)  2 pounds; 4 slices 
C)  3 pounds; 3 slices 
D)  5 pounds; 2 slices

Question 10

-When Ramona is in consumer equilibrium

Accepted Answer

A)  her total utilities of all goods are equal. 
B)  she is maximizing her utility, given her income and the prices of goods and services. 
C)  her total utility per dollar spent is equal for all goods. 
D)  any change in prices would make her worse off. 
A)  her total utilities of all goods are equal. 
B)  she is maximizing her utility, given her income and the prices of goods and services. 
C)  her total utility per dollar spent is equal for all goods. 
D)  any change in prices would make her worse off.

Question 11

The measure of the benefit you get from consuming the next cup of coffee is your

Accepted Answer

A)  marginal utility of coffee. 
B)  total utility from coffee. 
C)  total utility per dollar spent on coffee. 
D)  total utility from coffee when you are at your consumer equilibrium. 
A)  marginal utility of coffee. 
B)  total utility from coffee. 
C)  total utility per dollar spent on coffee. 
D)  total utility from coffee when you are at your consumer equilibrium.

Question 12

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. Bobby currently buys 6 pizzas and 2 CDs. To maximize his utility, he should

Accepted Answer

A)  buy more pizza and fewer CDs. 
B)  buy more CDs and fewer pizza. 
C)  buy more of both goods. 
D)  stay with the current combination of goods. 
A)  buy more pizza and fewer CDs. 
B)  buy more CDs and fewer pizza. 
C)  buy more of both goods. 
D)  stay with the current combination of goods.

Question 13

As an individual's consumption of a good increases

Accepted Answer

A)  his or her total utility increases. 
B)  his or her marginal utility increases. 
C)  the price of the good increases. 
D)  All of the above answers are correct. 
A)  his or her total utility increases. 
B)  his or her marginal utility increases. 
C)  the price of the good increases. 
D)  All of the above answers are correct.

Question 14

-The above table shows Tammy's total utility from videos and CDs. If Tammy has $70 to spend on videos and CDs and if the price of a video is $10 and the price of a CD is $20, then Tammy maximizes her utility by purchasing

Accepted Answer

A)  3 CDs and 1 video. 
B)  1 CD and 5 videos. 
C)  2 CDs and 3 videos. 
D)  none of the above 
A)  3 CDs and 1 video. 
B)  1 CD and 5 videos. 
C)  2 CDs and 3 videos. 
D)  none of the above

Question 15

Katie finds that the marginal utility from a compact disc is 30 and the marginal utility from a pizza is 10. The price of a compact disc is $15 and the price of a pizza is $10. In order to increase her utility, Katie should

Accepted Answer

A)  consume more compact discs and fewer pizzas. 
B)  consume fewer compact discs and more pizzas. 
C)  not change her consumption of pizza and compact discs. 
D)  consume fewer compact discs and fewer pizzas. 
A)  consume more compact discs and fewer pizzas. 
B)  consume fewer compact discs and more pizzas. 
C)  not change her consumption of pizza and compact discs. 
D)  consume fewer compact discs and fewer pizzas.

Question 16

Pizza Pepsi  
-The above table shows Priscilla's marginal utility from the two goods she consumes, pizza and Pepsi. The price of a slice of pizza is $2 and of a can of Pepsi is $1. Suppose Priscilla has $6 to spend. Which combination of pizza and Pepsi will maximize Priscilla's utility?

Accepted Answer

A)  3 slices of pizza 
B)  2 slices of pizza and 2 cans of Pepsi 
C)  3 cans of Pepsi and 1 slice of pizza 
D)  1 slice of pizza and 3 cans of Pepsi 
A)  3 slices of pizza 
B)  2 slices of pizza and 2 cans of Pepsi 
C)  3 cans of Pepsi and 1 slice of pizza 
D)  1 slice of pizza and 3 cans of Pepsi

Question 17

If Dana spends all her income on ice cream and Mountain Dew and her marginal utility per dollar from ice cream is greater than her marginal utility per dollar from Mountain Dew, she should buy more ice cream and less Mountain Dew.

Accepted Answer

A) True 
 B)False

Question 18

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

Accepted Answer

A)  doughnuts are an inferior good and coffee is a normal good for Hannah. 
B)  doughnuts are a normal good and coffee is an inferior good for Hannah. 
C)  doughnuts and coffee are normal goods for Hannah. 
D)  doughnuts and coffee are inferior goods for Hannah. 
A)  doughnuts are an inferior good and coffee is a normal good for Hannah. 
B)  doughnuts are a normal good and coffee is an inferior good for Hannah. 
C)  doughnuts and coffee are normal goods for Hannah. 
D)  doughnuts and coffee are inferior goods for Hannah.

Question 19

Fritos Fruit drinks  
-The table above shows the total utility from the two goods Freddy likes to consume. Suppose that Freddy has already eaten 5 bags of Fritos. If he consumes one more bag, his marginal utility will

Accepted Answer

A)  equal 40. 
B)  equal 35. 
C)  equal 15. 
D)  depend on the price of the extra bag. 
A)  equal 40. 
B)  equal 35. 
C)  equal 15. 
D)  depend on the price of the extra bag.

Question 20

The state Department of Agriculture raised the minimum price for a gallon of milk in the city on Tuesday to $4.37. "If you've got two or three kids and you're living on a fixed income and you're paying half your income on rent," Gioia said, "then you're really in a bind and you're making choices you should never have to make." If even after this price increase Gioia's marginal utility per dollar is higher for milk than for other goods, what should Gioia do?

Accepted Answer

A)  increase her consumption of milk 
B)  decrease her consumption of milk 
C)  not change her consumption of milk 
D)  increase her consumption of milk only if her income increases 
A)  increase her consumption of milk 
B)  decrease her consumption of milk 
C)  not change her consumption of milk 
D)  increase her consumption of milk only if her income increases

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

A consumer's total utility is maximized when the total utility per dollar from all goods is equalized.

Keesha consumes only milkshakes and burgers. At her consumer equilibrium, which of the following is TRUE when Keesha can buy any portion of a unit of a milkshake or burger?

The marginal utility of a third skirt is

-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. Suppose Becky rents 8 DVDs and buys 6 movie tickets per month. She

If the price of a good increases, all else the same, then the consumer's total utility will

If Mark's marginal utility per dollar spent on the last taco is 15 and his marginal utility per dollar spent on the last burrito is 20 units, what should Mark do to increase his total utility?

Cookies Cake -The above table shows Homer's marginal utility from consuming various quantities of chocolate chip cookies and cake. The price of cookies is $2 per pound, the price of cake is $2 per slice and Homer has $12 to spend on cookies and cake. Homer will consume of cookies and of cake.

-When Ramona is in consumer equilibrium

The measure of the benefit you get from consuming the next cup of coffee is your

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. Bobby currently buys 6 pizzas and 2 CDs. To maximize his utility, he should

As an individual's consumption of a good increases

-The above table shows Tammy's total utility from videos and CDs. If Tammy has $70 to spend on videos and CDs and if the price of a video is $10 and the price of a CD is $20, then Tammy maximizes her utility by purchasing

Katie finds that the marginal utility from a compact disc is 30 and the marginal utility from a pizza is 10. The price of a compact disc is $15 and the price of a pizza is $10. In order to increase her utility, Katie should

Pizza Pepsi -The above table shows Priscilla's marginal utility from the two goods she consumes, pizza and Pepsi. The price of a slice of pizza is $2 and of a can of Pepsi is $1. Suppose Priscilla has $6 to spend. Which combination of pizza and Pepsi will maximize Priscilla's utility?

If Dana spends all her income on ice cream and Mountain Dew and her marginal utility per dollar from ice cream is greater than her marginal utility per dollar from Mountain Dew, she should buy more ice cream and less Mountain Dew.

Fritos Fruit drinks -The table above shows the total utility from the two goods Freddy likes to consume. Suppose that Freddy has already eaten 5 bags of Fritos. If he consumes one more bag, his marginal utility will

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Exam 8: Utility and Demand

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

A consumer's total utility is maximized when the total utility per dollar from all goods is equalized.

Keesha consumes only milkshakes and burgers. At her consumer equilibrium, which of the following is TRUE when Keesha can buy any portion of a unit of a milkshake or burger?

The marginal utility of a third skirt is

-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. Suppose Becky rents 8 DVDs and buys 6 movie tickets per month. She

If the price of a good increases, all else the same, then the consumer's total utility will

If Mark's marginal utility per dollar spent on the last taco is 15 and his marginal utility per dollar spent on the last burrito is 20 units, what should Mark do to increase his total utility?

-When Ramona is in consumer equilibrium

The measure of the benefit you get from consuming the next cup of coffee is your

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. Bobby currently buys 6 pizzas and 2 CDs. To maximize his utility, he should

As an individual's consumption of a good increases

-The above table shows Tammy's total utility from videos and CDs. If Tammy has $70 to spend on videos and CDs and if the price of a video is $10 and the price of a CD is $20, then Tammy maximizes her utility by purchasing

Katie finds that the marginal utility from a compact disc is 30 and the marginal utility from a pizza is 10. The price of a compact disc is $15 and the price of a pizza is $10. In order to increase her utility, Katie should

Pizza Pepsi -The above table shows Priscilla's marginal utility from the two goods she consumes, pizza and Pepsi. The price of a slice of pizza is $2 and of a can of Pepsi is $1. Suppose Priscilla has $6 to spend. Which combination of pizza and Pepsi will maximize Priscilla's utility?

If Dana spends all her income on ice cream and Mountain Dew and her marginal utility per dollar from ice cream is greater than her marginal utility per dollar from Mountain Dew, she should buy more ice cream and less Mountain Dew.

Fritos Fruit drinks -The table above shows the total utility from the two goods Freddy likes to consume. Suppose that Freddy has already eaten 5 bags of Fritos. If he consumes one more bag, his marginal utility will

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

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