Exam 20: Consumer Choice

Suppose that indifference curve I1 lies to the right of indifference curve I2. We can conclude that

-Refer to the above table. Suppose the price of a movie is $5 and the income of the consumer is $29. What are the quantities demanded of hamburger at prices of $2 and $1 respectively?

If the last $5 spent on movies added 30 utils to your total satisfaction and the last $8 spent on books add 56 utils

Which of the following is NOT true about indifference curves?

Because the behavioral economics approach suggests many alternative behaviors that people might exhibit if they fail to behave as if they are rational, this approach

Kathy has eaten five cookies. The fifth cookie makes Kathy sick. This means that for Kathy

A set of indifference curves on a graph is called

Explain how a consumer maximizes utility.

One student loves donuts. He receives 100 units of utility for the first donut, an additional 80 for the second, an additional 60 for the third, another 50 for the fourth, and another 20 for the fifth. The marginal utility of the fourth donut is ________ and the total utility from consuming four donuts is ________.

Dillon is undecided about whether to eat at a restaurant or to order pizza at home. He then obtains a coupon for 10 percent off at the restaurant and decides to go there to eat. This is an example of

Jose has just eaten another hot dog and his total utility decreased. This means that Jose's marginal utility for this additional hot dog is

All possible combinations of goods that can be purchased at fixed prices with a specific income is

Mathematically the marginal rate of substitution is

-Refer to the above table. The table gives the various combinations of Good A and Good B along Jane's indifference curve. The marginal rate of substitution when Jane goes from combination A to combination B is

You consider yourself to be a rational consumer. The marginal utility/price ratio of coffee is 12 utils per dollar. If the price of a donut is $0.75, you should only buy the donut if it gives you at least

When indifference curve analysis is used, a consumer optimum occurs at the point at which

The set of goods and services that maximizes the level of satisfaction for each consumer subject to limited income is

-In the above table, what is the marginal utility of the sixth hotdog consumed?

A curve where every combination of the two goods being considered yields the same level of satisfaction is known as

-Refer to the above table. At what quantity does diminishing marginal utility set in?