Exam 21: The Theory of Consumer Choice

Suppose the price of good X falls. As a result, the quantity demanded for good X increases for a particular consumer. For this consumer, the substitution effect induced the consumer to purchase more X while the income effect induced the consumer to purchase less X. We can infer that X is a(n)

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Question 481

Two economists found empirical evidence that when the price of rice decreased in the Hunan province of China, local residents consumed less rice than before the price decrease. The study provides a real-world example of a(n)

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Question 482

The marginal rate of substitution is equal to the

(Multiple Choice)

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Question 483

Figure 21-14 -Refer to Figure 21-14. Which of the graphs shown represent indifference curves for perfect substitutes?

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Question 484

The opportunity cost of current household consumption is the

(Multiple Choice)

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Question 485

Figure 21-14 -Refer to Figure 21-14. Which of the graphs shown may represent indifference curves?

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Question 486

A consumer chooses an optimal consumption point where the

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Question 487

Figure 21-14 -Refer to Figure 21-14. Which of the graphs illustrates indifference curves for which the marginal rate of substitution varies?

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Question 488

Figure 21-13 -Refer to Figure 21-13. As the consumer moves from A to B to C, the marginal rate of substitution

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Question 489

The consumer's optimum is where

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Question 490

The two "goods" used when economists analyze labor supply are

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Question 491

Figure 21-5 (a) (b) -Refer to Figure 21-5. In graph (b), what is the price of good X relative to the price of good Y (i.e., P_x/P_y)?

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Question 492

Figure 21-17 -Refer to Figure 21-17. When the price of X is $40, the price of Y is $40, and income is $160, Paul's optimal choice is point B. Then Paul's income increases to $320, and his optimal choice is point E. For Paul,

(Multiple Choice)

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Question 493

A consumer's preferences for right shoes and left shoes can be represented by indifference curves that are

(Multiple Choice)

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Question 494

Which of the following equations corresponds to an optimal choice point? (i) MRS = P_X/P_Y (ii) MU_X/MU_Y = P_X/P_Y (iii) MU_X/P_X = MU_Y/P_Y (iv) MU_X/P_Y = MU_Y/P_X

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Question 495

Figure 21-2 The downward-sloping line on the figure represents a consumer's budget constraint. -Refer to Figure 21-2. A consumer who chooses to spend all of her income could be at which point(s) on the figure?

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Question 496

Karen, Tara, and Chelsea each buy ice cream and paperback novels to enjoy on hot summer days. Ice cream costs $5 per gallon, and paperback novels cost $8 each. Karen has a budget of $80, Tara has a budget of $60, and Chelsea has a budget of $40 to spend on ice cream and paperback novels. Who can afford to purchase 5 gallons of ice cream and 8 paperback novels?

(Multiple Choice)

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Question 497

Scenario 21-4 Frank spends all of his income of $240 per month on shirts and hats. The price of a shirt is $40 and the price of a hat is $30. -Refer to Scenario 21-4. If Frank buys 3 shirts during a certain month, then how many hats does he buy during that month?

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Question 498

Figure 21-14 -Refer to Figure 21-14. Which of the graphs illustrates indifference curves for which the marginal rate of substitution is undefined?

(Multiple Choice)

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Question 499

Figure 21-25 The figure pertains to a particular consumer. On the axes, X represents the quantity of good X and Y represents the quantity of good Y. -Refer to Figure 21-25. Suppose the price of good X is $15, the price of good Y is $10, and the consumer's income is $450. Then the consumer's optimal choice is to buy

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Question 500

Showing 481 - 500 of 568

Suppose the price of good X falls. As a result, the quantity demanded for good X increases for a particular consumer. For this consumer, the substitution effect induced the consumer to purchase more X while the income effect induced the consumer to purchase less X. We can infer that X is a(n)

Two economists found empirical evidence that when the price of rice decreased in the Hunan province of China, local residents consumed less rice than before the price decrease. The study provides a real-world example of a(n)

The marginal rate of substitution is equal to the

Figure 21-14 -Refer to Figure 21-14. Which of the graphs shown represent indifference curves for perfect substitutes?

The opportunity cost of current household consumption is the

Figure 21-14 -Refer to Figure 21-14. Which of the graphs shown may represent indifference curves?

A consumer chooses an optimal consumption point where the

Figure 21-14 -Refer to Figure 21-14. Which of the graphs illustrates indifference curves for which the marginal rate of substitution varies?

Figure 21-13 -Refer to Figure 21-13. As the consumer moves from A to B to C, the marginal rate of substitution

The consumer's optimum is where

The two "goods" used when economists analyze labor supply are

Figure 21-5 (a) (b) -Refer to Figure 21-5. In graph (b), what is the price of good X relative to the price of good Y (i.e., P_x/P_y)?

Figure 21-17 -Refer to Figure 21-17. When the price of X is $40, the price of Y is $40, and income is $160, Paul's optimal choice is point B. Then Paul's income increases to $320, and his optimal choice is point E. For Paul,

A consumer's preferences for right shoes and left shoes can be represented by indifference curves that are

Which of the following equations corresponds to an optimal choice point? (i) MRS = P_X/P_Y (ii) MU_X/MU_Y = P_X/P_Y (iii) MU_X/P_X = MU_Y/P_Y (iv) MU_X/P_Y = MU_Y/P_X

Figure 21-2 The downward-sloping line on the figure represents a consumer's budget constraint. -Refer to Figure 21-2. A consumer who chooses to spend all of her income could be at which point(s) on the figure?

Scenario 21-4 Frank spends all of his income of $240 per month on shirts and hats. The price of a shirt is $40 and the price of a hat is $30. -Refer to Scenario 21-4. If Frank buys 3 shirts during a certain month, then how many hats does he buy during that month?

Figure 21-14 -Refer to Figure 21-14. Which of the graphs illustrates indifference curves for which the marginal rate of substitution is undefined?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

Frontiers in Microeconomics

Filters

Exam 21: The Theory of Consumer Choice

Suppose the price of good X falls. As a result, the quantity demanded for good X increases for a particular consumer. For this consumer, the substitution effect induced the consumer to purchase more X while the income effect induced the consumer to purchase less X. We can infer that X is a(n)

Two economists found empirical evidence that when the price of rice decreased in the Hunan province of China, local residents consumed less rice than before the price decrease. The study provides a real-world example of a(n)

The marginal rate of substitution is equal to the

Figure 21-14 -Refer to Figure 21-14. Which of the graphs shown represent indifference curves for perfect substitutes?

The opportunity cost of current household consumption is the

Figure 21-14 -Refer to Figure 21-14. Which of the graphs shown may represent indifference curves?

A consumer chooses an optimal consumption point where the

Figure 21-14 -Refer to Figure 21-14. Which of the graphs illustrates indifference curves for which the marginal rate of substitution varies?

Figure 21-13 -Refer to Figure 21-13. As the consumer moves from A to B to C, the marginal rate of substitution

The consumer's optimum is where

The two "goods" used when economists analyze labor supply are

Figure 21-5 (a) (b) -Refer to Figure 21-5. In graph (b), what is the price of good X relative to the price of good Y (i.e., Px/Py)?

Figure 21-17 -Refer to Figure 21-17. When the price of X is $40, the price of Y is $40, and income is $160, Paul's optimal choice is point B. Then Paul's income increases to $320, and his optimal choice is point E. For Paul,

A consumer's preferences for right shoes and left shoes can be represented by indifference curves that are

Which of the following equations corresponds to an optimal choice point? (i) MRS = PX/PY (ii) MUX/MUY = PX/PY (iii) MUX/PX = MUY/PY (iv) MUX/PY = MUY/PX

Figure 21-2 The downward-sloping line on the figure represents a consumer's budget constraint. -Refer to Figure 21-2. A consumer who chooses to spend all of her income could be at which point(s) on the figure?

Scenario 21-4 Frank spends all of his income of $240 per month on shirts and hats. The price of a shirt is $40 and the price of a hat is $30. -Refer to Scenario 21-4. If Frank buys 3 shirts during a certain month, then how many hats does he buy during that month?

Figure 21-14 -Refer to Figure 21-14. Which of the graphs illustrates indifference curves for which the marginal rate of substitution is undefined?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

Frontiers in Microeconomics

Filters

Figure 21-5 (a) (b) -Refer to Figure 21-5. In graph (b), what is the price of good X relative to the price of good Y (i.e., P_x/P_y)?

Which of the following equations corresponds to an optimal choice point? (i) MRS = P_X/P_Y (ii) MU_X/MU_Y = P_X/P_Y (iii) MU_X/P_X = MU_Y/P_Y (iv) MU_X/P_Y = MU_Y/P_X