Exam 19: Consumer Choice Appendix: Indifference Curves

- Use the indifference curves and the budget lines in Figure 19.3 to answer the indicated question.Assume the price of Y is $1 per unit.In Figure 19.3,point E

The benefit that consumers get when they buy goods at the equilibrium price is called

Consumers who actually purchase a good either were willing to pay that price or more.

The law of diminishing marginal utility suggests that

If the equilibrium price rises,

When economists refer to the determinants of demand,they are referring to factors that

Which of the following is not a determinant of demand?

Price discrimination works best when

Explain the benefits consumers enjoy from competitive markets.

-Complete Table 19.3 .Assume the price of cola is $8 per unit and the price of pretzels is $4 per unit. Refer to Table 19.3.If Michael has $28 dollars to spend,why will three colas and four pretzels not be optimal?

The law of diminishing marginal utility gives us a deeper understanding of the downward-sloping demand curve because

The law of diminishing marginal utility does not apply to goods that a person really enjoys.

Refer to Figure 19.1.The total consumer surplus in this market is equal to

Airline companies engage in price discrimination by

A budget constraint line represents combinations of two goods that provide an individual the same total utility.

All consumers in the market enjoy a consumer surplus.

Most goods can yield

Status and ego considerations in consumption are economic explanations of demand.

Marginal utility is the

An indifference curve shows the combinations of two goods that yield the same level of utility.