Question 1

Paul has the utility function U(q1,q2)= q1q2.If Paul consumes q1 = 4 and q2 = 2 his Marginal Rate of Substitution is

Accepted Answer

A) -2. 
B) 1. 
C) -1. 
D) -1/2. 
A) -2. 
B) 1. 
C) -1. 
D) -1/2.

Question 2

-Max has allocated $100 toward meats for his barbecue.His budget line and an indifference map are shown in the above figure.What is the price of chicken?

Accepted Answer

A) $0.80/lb 
B) $1.25/lb 
C) $4/lb 
D) $5/lb 
A) $0.80/lb 
B) $1.25/lb 
C) $4/lb 
D) $5/lb

Question 3

Joe's budget constraint equals 500 = 2F + 100S,where $500 is Joe's income,$2 is the price of food (F)and $100 is the price of shelter (S).How much food can Joe buy if he buys one unit of shelter?

Accepted Answer

A) two units 
B) 200 units 
C) 250 units 
D) 400 units 
A) two units 
B) 200 units 
C) 250 units 
D) 400 units

Question 4

The absolute value of the slope of an indifference curve equals the ratio of the marginal utilities of the two goods involved.

Accepted Answer

A) True 
 B)False

Question 5

-John is indifferent between canned soup and fresh soup.Canned soup sells for $1 per serving and fresh soup sells for $2 per serving.Assuming that John has allocated $4 toward soup,how will he spend it? Explain your answer by drawing John's budget line and indifference curves.

Accepted Answer

@#IMG-DLM& See the above figure.Canned a

Question 6

Teddy has preferences given by the utility function U(K,L)= 2L + K where K = pounds of Kale per month and L = pounds of lettuce per month.What is Teddy's Marginal Utility of Kale? What is Teddy's Marginal Utility from Lettuce? If Kale is on the horizontal axis,what is Teddy's marginal Rate of Substitution?

Accepted Answer

The marginal utility of Kale is the part

Question 7

If two indifference curves were to intersect at a point,this would violate the assumption of

Accepted Answer

A) transitivity. 
B) completeness. 
C) Both A and B above. 
D) None of the above. 
A) transitivity. 
B) completeness. 
C) Both A and B above. 
D) None of the above.

Question 8

If the utility function (U)between food (F)and clothing (C)can be represented as U =  
,the marginal utility of food equals

Accepted Answer

A)   
. 
B)    
C) 1/2   
D) 1/2  
. 
A)   
. 
B)    
C) 1/2   
D) 1/2  
.

Question 9

With respect to consuming food and shelter,two consumers choose the same bundles and both claim to be in equilibrium.We therefore know that

Accepted Answer

A) they both have the same MRS of food for shelter. 
B) they both face the same prices. 
C) they both face the same budget lines. 
D) None of above. 
A) they both have the same MRS of food for shelter. 
B) they both face the same prices. 
C) they both face the same budget lines. 
D) None of above.

Question 10

An indifference curve represents bundles of goods that a consumer

Accepted Answer

A) views as equally desirable. 
B) ranks from most preferred to least preferred. 
C) refers to any other bundle of goods. 
D) All of the above. 
A) views as equally desirable. 
B) ranks from most preferred to least preferred. 
C) refers to any other bundle of goods. 
D) All of the above.

Paul has the utility function U(q₁,q₂)= q₁q₂.If Paul consumes q₁= 4 and q₂= 2 his Marginal Rate of Substitution is

-Max has allocated $100 toward meats for his barbecue.His budget line and an indifference map are shown in the above figure.What is the price of chicken?

Joe's budget constraint equals 500 = 2F + 100S,where $500 is Joe's income,$2 is the price of food (F)and $100 is the price of shelter (S).How much food can Joe buy if he buys one unit of shelter?

The absolute value of the slope of an indifference curve equals the ratio of the marginal utilities of the two goods involved.

-John is indifferent between canned soup and fresh soup.Canned soup sells for $1 per serving and fresh soup sells for $2 per serving.Assuming that John has allocated $4 toward soup,how will he spend it? Explain your answer by drawing John's budget line and indifference curves.

If two indifference curves were to intersect at a point,this would violate the assumption of

If the utility function (U)between food (F)and clothing (C)can be represented as U = ,the marginal utility of food equals

With respect to consuming food and shelter,two consumers choose the same bundles and both claim to be in equilibrium.We therefore know that

An indifference curve represents bundles of goods that a consumer

Introduction

Supply and Demand

Demand

Consumer Welfare and Policy Analysis

Firms and Production

Costs

Competitive Firms and Markets

Properties and Applications of the Competitive Model

General Equilibrium and Economic Welfare

Monopoly and Monopsony

Pricing and Advertising

Game Theory

Oligopoly and Monopolistic Competition

Factor Markets

Uncertainty

Property Rights, Externalities, Rivalry, and Exclusion

Asymmetric Information

Contracts and Moral Hazards

Filters

Exam 3: A Consumers Constrained Choice

Paul has the utility function U(q1,q2)= q1q2.If Paul consumes q1 = 4 and q2 = 2 his Marginal Rate of Substitution is

-Max has allocated $100 toward meats for his barbecue.His budget line and an indifference map are shown in the above figure.What is the price of chicken?

Joe's budget constraint equals 500 = 2F + 100S,where $500 is Joe's income,$2 is the price of food (F)and $100 is the price of shelter (S).How much food can Joe buy if he buys one unit of shelter?

The absolute value of the slope of an indifference curve equals the ratio of the marginal utilities of the two goods involved.

-John is indifferent between canned soup and fresh soup.Canned soup sells for $1 per serving and fresh soup sells for $2 per serving.Assuming that John has allocated $4 toward soup,how will he spend it? Explain your answer by drawing John's budget line and indifference curves.

If two indifference curves were to intersect at a point,this would violate the assumption of

If the utility function (U)between food (F)and clothing (C)can be represented as U = ,the marginal utility of food equals

With respect to consuming food and shelter,two consumers choose the same bundles and both claim to be in equilibrium.We therefore know that

An indifference curve represents bundles of goods that a consumer

Introduction

Supply and Demand

Demand

Consumer Welfare and Policy Analysis

Firms and Production

Costs

Competitive Firms and Markets

Properties and Applications of the Competitive Model

General Equilibrium and Economic Welfare

Monopoly and Monopsony

Pricing and Advertising

Game Theory

Oligopoly and Monopolistic Competition

Factor Markets

Uncertainty

Property Rights, Externalities, Rivalry, and Exclusion

Asymmetric Information

Contracts and Moral Hazards

Filters

Paul has the utility function U(q₁,q₂)= q₁q₂.If Paul consumes q₁= 4 and q₂= 2 his Marginal Rate of Substitution is