Question 1

How can you compute the total utility derived from consuming five hamburgers using marginal utilities?

Accepted Answer

The total utility from consuming any pro

Question 2

The principle of diminishing marginal utility implies that the

Accepted Answer

A)  marginal utility of a product is negative. 
B)  total utility from a product is also diminishing as more units are consumed. 
C)  rate of change of total utility is diminishing as more units are consumed. 
D)  rate of change of marginal utility is very low as more units are consumed. 
A)  marginal utility of a product is negative. 
B)  total utility from a product is also diminishing as more units are consumed. 
C)  rate of change of total utility is diminishing as more units are consumed. 
D)  rate of change of marginal utility is very low as more units are consumed.

Question 3

Milkshakes Sodas  
-The table above shows Tom's total utility from milkshakes and sodas. A milkshake costs $2.00. How much marginal utility per dollar would Tom get if he purchased the ninth milkshake?

Accepted Answer

A)  1728 units per dollar 
B)  20 units per dollar 
C)  10 units per dollar 
D)  none of the above 
A)  1728 units per dollar 
B)  20 units per dollar 
C)  10 units per dollar 
D)  none of the above

Question 4

-As shown in the above table, Sam enjoys sailing and skiing equally well. Which of the following is TRUE?

Accepted Answer

A)  Sam will not consume the same number of hours of sailing and skiing if the price per hour of sailing is more than that of skiing. 
B)  If the prices per hour of sailing and skiing are the same, Sam will not spend the same number of hours at each activity. 
C)  The marginal utility of the 3rd hour of either sailing or skiing is 120. 
D)  None of the above is true. 
A)  Sam will not consume the same number of hours of sailing and skiing if the price per hour of sailing is more than that of skiing. 
B)  If the prices per hour of sailing and skiing are the same, Sam will not spend the same number of hours at each activity. 
C)  The marginal utility of the 3rd hour of either sailing or skiing is 120. 
D)  None of the above is true.

Question 5

Diminishing marginal utility means that

Accepted Answer

A)  Ralph will enjoy his second hamburger less than the first. 
B)  the total utility from one hamburger exceeds the total utility from two hamburgers. 
C)  the price of two hamburgers is twice the price of one. 
D)  beyond a certain point, total utility decreases as income rises. 
A)  Ralph will enjoy his second hamburger less than the first. 
B)  the total utility from one hamburger exceeds the total utility from two hamburgers. 
C)  the price of two hamburgers is twice the price of one. 
D)  beyond a certain point, total utility decreases as income rises.

Question 6

-The table above gives Jane's total utility from magazines and CDs. What is the marginal utility of Jane's sixth magazine?

Accepted Answer

A)  80 units 
B)  60 units 
C)  36 units 
D)  15 units 
A)  80 units 
B)  60 units 
C)  36 units 
D)  15 units

Question 7

When Frankie spends all his money in such a way that the marginal utility per dollar is the same for all final purchases of products he consumes, Frankie has maximized

Accepted Answer

A)  his marginal utility. 
B)  his total utility. 
C)  the number of products he consumes. 
D)  his total expenditure on all products. 
A)  his marginal utility. 
B)  his total utility. 
C)  the number of products he consumes. 
D)  his total expenditure on all products.

Question 8

-Suppose that you consume only pizza, which costs $4 per slice, and Diet Pepsi, which costs $2 each. The table above gives your utility from consuming these two goods. If your income is $20, which of the following consumption combinations will you choose?

Accepted Answer

A)  5 slices of pizza and no Diet Pepsi 
B)  4 slices of pizza and 2 Diet Pepsis 
C)  3 slices of pizza and 4 Diet Pepsis 
D)  2 slice of pizza and 6 Diet Pepsis 
A)  5 slices of pizza and no Diet Pepsi 
B)  4 slices of pizza and 2 Diet Pepsis 
C)  3 slices of pizza and 4 Diet Pepsis 
D)  2 slice of pizza and 6 Diet Pepsis

Question 9

When a consumer spends all of his or her income and consumes a bundle of goods such that the marginal utility per dollar from all goods is equal, then the

Accepted Answer

A)  consumer's total utility is maximized. 
B)  consumer is in his or her consumption equilibrium. 
C)  marginal utilities for each good are maximized. 
D)  Both answers A and B are correct. 
A)  consumer's total utility is maximized. 
B)  consumer is in his or her consumption equilibrium. 
C)  marginal utilities for each good are maximized. 
D)  Both answers A and B are correct.

Question 10

At the utility maximizing equilibrium for two goods, X and Y, which of the following must be TRUE?

Accepted Answer

A)  The marginal utility per dollar spent on X will exceed the marginal utility per dollar spent on Y. 
B)  The total expenditure will be the same for each good. 
C)  The marginal utility per dollar from X equals the marginal utility per dollar from Y. 
D)  The marginal utility will be the same for each good. 
A)  The marginal utility per dollar spent on X will exceed the marginal utility per dollar spent on Y. 
B)  The total expenditure will be the same for each good. 
C)  The marginal utility per dollar from X equals the marginal utility per dollar from Y. 
D)  The marginal utility will be the same for each good.

Question 11

-Kelly's marginal utilities for magazines and packages of gummy bears are listed in the table above. For Kelly, what is the total utility received from consuming 5 magazines?

Accepted Answer

A)  5 
B)  20 
C)  25 
D)  255 
A)  5 
B)  20 
C)  25 
D)  255

Question 12

"I really enjoy watching movies. The first one is best. After that I still enjoy movies but the last one is not as much fun to watch as the one before it." This statement reflects the

Accepted Answer

A)  principle of diminishing total utility. 
B)  principle of diminishing marginal utility. 
C)  principle of increasing marginal utility. 
D)  law of supply. 
A)  principle of diminishing total utility. 
B)  principle of diminishing marginal utility. 
C)  principle of increasing marginal utility. 
D)  law of supply.

Question 13

The Paradox of Value is resolved by the willingness for an individual to pay a high price for a good or service that has a high marginal utility per dollar.

Accepted Answer

A) True 
 B)False

Question 14

Bianca consumes apples and bananas and is in consumer equilibrium. The marginal utility of the last apple is 10 and the marginal utility of the last banana is 20. If the price of an apple is $0.50, then what is the price of a banana?

Accepted Answer

A)  $0.10 
B)  $0.25 
C)  $0.50 
D)  $1.00 
A)  $0.10 
B)  $0.25 
C)  $0.50 
D)  $1.00

Question 15

Milkshakes Sodas  
-The table above shows Tom's total utility from milkshakes and sodas. A soda costs $1.00. What is the marginal utility per dollar spent when the eighth soda is purchased?

Accepted Answer

A)  32 units per dollar 
B)  20 units per dollar 
C)  10 units per dollar 
D)  8 units per dollar 
A)  32 units per dollar 
B)  20 units per dollar 
C)  10 units per dollar 
D)  8 units per dollar

Question 16

-Amy has the total utility values given above for DVD rentals a week. Complete the table by calculating her marginal utilities.

Accepted Answer

@#IMG-DLM& The compl

Question 17

To maximize her utility, Pat should spend all of her money and buy goods in a way that

Accepted Answer

A)  the marginal utility of the last unit of each good is the same. 
B)  the marginal utility per dollar from each good is the same. 
C)  her total expenditure on each good is the same. 
D)  her price elasticity of demand for each good is the same. 
A)  the marginal utility of the last unit of each good is the same. 
B)  the marginal utility per dollar from each good is the same. 
C)  her total expenditure on each good is the same. 
D)  her price elasticity of demand for each good is the same.

Question 18

Jennifer consumes both apples and bread. Let Pa be the price of an apple and Pb the price of a loaf of bread. TUa is her total utility from apples and TUb is her total utility from bread. MUa is her marginal utility from apples and MUb is her marginal utility from bread. When Jennifer is in consumer equilibrium

Accepted Answer

A)  MUa/TUa = MUb/TUb. 
B)  MUa/Pb = MUb/Pa. 
C)  MUa/Pa = MUb/Pb. 
D)  TUa/Pb = TUb/Pb. 
A)  MUa/TUa = MUb/TUb. 
B)  MUa/Pb = MUb/Pa. 
C)  MUa/Pa = MUb/Pb. 
D)  TUa/Pb = TUb/Pb.

Question 19

Marginal utility

Accepted Answer

A)  characterizes things of little use. 
B)  is the additional utility derived from the last unit of a good consumed. 
C)  is an implication of the law of demand. 
D)  is always negative when total utility is positive and positive when total utility is negative. 
A)  characterizes things of little use. 
B)  is the additional utility derived from the last unit of a good consumed. 
C)  is an implication of the law of demand. 
D)  is always negative when total utility is positive and positive when total utility is negative.

Question 20

Lucy buys only magazines and CDs. Both are normal goods. Lucy's income decreases, but the prices of magazines and CDs do not change. Marginal utility theory predicts that Lucy will ________.

Accepted Answer

A)  buy fewer magazines and fewer CDs 
B)  substitute magazines for CDs 
C)  increase her marginal utility from both magazines and CDs by buying more magazines and CDs 
D)  buy more magazines and more CDs 
A)  buy fewer magazines and fewer CDs 
B)  substitute magazines for CDs 
C)  increase her marginal utility from both magazines and CDs by buying more magazines and CDs 
D)  buy more magazines and more CDs

How can you compute the total utility derived from consuming five hamburgers using marginal utilities?

The principle of diminishing marginal utility implies that the

Milkshakes Sodas -The table above shows Tom's total utility from milkshakes and sodas. A milkshake costs $2.00. How much marginal utility per dollar would Tom get if he purchased the ninth milkshake?

-As shown in the above table, Sam enjoys sailing and skiing equally well. Which of the following is TRUE?

Diminishing marginal utility means that

-The table above gives Jane's total utility from magazines and CDs. What is the marginal utility of Jane's sixth magazine?

When Frankie spends all his money in such a way that the marginal utility per dollar is the same for all final purchases of products he consumes, Frankie has maximized

-Suppose that you consume only pizza, which costs $4 per slice, and Diet Pepsi, which costs $2 each. The table above gives your utility from consuming these two goods. If your income is $20, which of the following consumption combinations will you choose?

When a consumer spends all of his or her income and consumes a bundle of goods such that the marginal utility per dollar from all goods is equal, then the

At the utility maximizing equilibrium for two goods, X and Y, which of the following must be TRUE?

-Kelly's marginal utilities for magazines and packages of gummy bears are listed in the table above. For Kelly, what is the total utility received from consuming 5 magazines?

"I really enjoy watching movies. The first one is best. After that I still enjoy movies but the last one is not as much fun to watch as the one before it." This statement reflects the

The Paradox of Value is resolved by the willingness for an individual to pay a high price for a good or service that has a high marginal utility per dollar.

Bianca consumes apples and bananas and is in consumer equilibrium. The marginal utility of the last apple is 10 and the marginal utility of the last banana is 20. If the price of an apple is $0.50, then what is the price of a banana?

Milkshakes Sodas -The table above shows Tom's total utility from milkshakes and sodas. A soda costs $1.00. What is the marginal utility per dollar spent when the eighth soda is purchased?

-Amy has the total utility values given above for DVD rentals a week. Complete the table by calculating her marginal utilities.

To maximize her utility, Pat should spend all of her money and buy goods in a way that

Marginal utility

Lucy buys only magazines and CDs. Both are normal goods. Lucy's income decreases, but the prices of magazines and CDs do not change. Marginal utility theory predicts that Lucy 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

How can you compute the total utility derived from consuming five hamburgers using marginal utilities?

The principle of diminishing marginal utility implies that the

Milkshakes Sodas -The table above shows Tom's total utility from milkshakes and sodas. A milkshake costs $2.00. How much marginal utility per dollar would Tom get if he purchased the ninth milkshake?

-As shown in the above table, Sam enjoys sailing and skiing equally well. Which of the following is TRUE?

Diminishing marginal utility means that

-The table above gives Jane's total utility from magazines and CDs. What is the marginal utility of Jane's sixth magazine?

When Frankie spends all his money in such a way that the marginal utility per dollar is the same for all final purchases of products he consumes, Frankie has maximized

-Suppose that you consume only pizza, which costs $4 per slice, and Diet Pepsi, which costs $2 each. The table above gives your utility from consuming these two goods. If your income is $20, which of the following consumption combinations will you choose?

When a consumer spends all of his or her income and consumes a bundle of goods such that the marginal utility per dollar from all goods is equal, then the

At the utility maximizing equilibrium for two goods, X and Y, which of the following must be TRUE?

-Kelly's marginal utilities for magazines and packages of gummy bears are listed in the table above. For Kelly, what is the total utility received from consuming 5 magazines?

"I really enjoy watching movies. The first one is best. After that I still enjoy movies but the last one is not as much fun to watch as the one before it." This statement reflects the

The Paradox of Value is resolved by the willingness for an individual to pay a high price for a good or service that has a high marginal utility per dollar.

Bianca consumes apples and bananas and is in consumer equilibrium. The marginal utility of the last apple is 10 and the marginal utility of the last banana is 20. If the price of an apple is $0.50, then what is the price of a banana?

Milkshakes Sodas -The table above shows Tom's total utility from milkshakes and sodas. A soda costs $1.00. What is the marginal utility per dollar spent when the eighth soda is purchased?

-Amy has the total utility values given above for DVD rentals a week. Complete the table by calculating her marginal utilities.

To maximize her utility, Pat should spend all of her money and buy goods in a way that

Marginal utility

Lucy buys only magazines and CDs. Both are normal goods. Lucy's income decreases, but the prices of magazines and CDs do not change. Marginal utility theory predicts that Lucy 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