Exam 13: Consumer Choice and Demand

Suppose the quantity of burgers is measured on the horizontal axis and the quantity of bags of French fries is measured on the vertical axis.The marginal rate of substitution for burgers is

Bottles of Soda Slices of Pizza -The table above gives Ali's total utility from consuming bottles of soda and slices of pizza.The price of pizza is $2 per slice and the price of soda is $1 per bottle.His marginal utility from the 4th slice of pizza is

-Which of the above figures reflects an increase in the consumer's budget?

-The figure above shows a consumer's budget line between sodas and DVD rentals.Point d represents an

Marginal utility is the change in total utility that results from

The slope of the budget line can be interpreted as which of the following?

-Tom is stranded on a deserted island where he can only consume coconuts and crabs.Two of his indifference curves are in the figure above. a.Would Tom prefer his consumption to be at point a or at point b? At point b or at point c? Explain your answers. b.Between points a and b,what is Tom's marginal rate of substitution for a crab?

-The above figure shows one of Cheri's indifference curves.Suppose point a represents the best affordable point for Cheri.Cheri's best affordable point could move to point b if

-Given the data in the above table,what is the marginal utility of the third quart of ice cream?

-________ leads to a decrease in marginal utility per dollar for soda.

Explain why total utility is maximized when the marginal utility per dollar from a good is equal across goods.

The benefit that John gets from eating an additional grape is called the ________ the grape.

"Every point on a demand curve represents a consumer equilibrium in the indifference curve model." Explain why the previous statement is correct or not.

In the indifference curve/budget line diagram,consumers reach higher indifference curves when

For David,the marginal utility from an additional car is 2,000 units and the marginal utility from an additional vacation is 1,000 units.David is allocating all his budget.Hence to maximize his utility,David will