Exam 7: Utility Maximization

Assume that Tonya consumes only two products, pizza and potato chips, out of a given budget.Both are normal goods for Tonya.If the price of pizza decreases, then Tonya's consumption of pizza will

A leftward shift of a consumer's budget line to a position parallel with the original one could indicate that the

After eating four slices of pizza, you are offered a fifth slice for free.You turn down the fifth slice.Your refusal indicates that the

Suppose that football tickets at your university are given away for free and that there are still empty seats for all games.Ignoring all other costs of going to the games, you should continue attending until your

The consumer demand curve for a product is downsloping because marginal utility is constant when price declines.

The ability of a good or service to satisfy wants is called

The utility from a specific product is

Marginal utility is the

In spending all his income on beer and pizza, Fred finds that the marginal utility of the last pizza he consumed is 8, and the marginal utility of the last bottle of beer is 4.The price of a bottle of beer is $1.50.If Fred has maximized his utility, the price of pizza must be

An increase in the real income of a consumer is one result from an increase in the price of a product that the consumer is buying.

Which of the following statements about utility is true?

The financing of health care through insurance has

If a consumer has an income of $200, the price of X is $5, and the price of Y is $10, what is the maximum quantity of X the consumer is able to purchase?

When DVD players start becoming obsolete then, to potential thieves, the

The law of diminishing marginal utility explains why

Marginal utility is the accumulation of the total utility from successive units of a good or service consumed.

Indifference curves are linear, and budget lines are convex to the origin.

Which of the following statements is correct?

(Consider This) When the federal government started requiring restaurants to print calorie counts next to menu items, some people increased their consumption of higher-calorie items.Whichof the following best explains this phenomenon?

A consumer currently spends a given budget on two goods, X and Y, in such quantities that the marginal utility of X is 10 and the marginal utility of Y is 8.The unit priceof X is $5 and the unit price of Y is $2.The utility-maximizing rule suggests that this consumer should