Exam 5: Consumer Choice: Individual and Market Demand

Figure 5-12 -In Figure 5-12,the move in the consumer equilibrium from A to B shows that

Figure 5-13 -In Figure 5-13,the slope of the budget line (dropping all minus signs)equals

The law of diminishing marginal utility states that total utility will increase at a decreasing rate as additional units of a commodity are acquired.

Figure 5-13 -In Figure 5-13,the line AB is

The host at a party offers Justin a sixth beer.Justin says,"No thanks,man.The marginal utility of that fifth beer was,like,20 cents,but the marginal utility of the sixth would be minus 10 cents." If Justin consumes the sixth beer,his total utility will

Figure 5-18 -In Figure 5-18,point D for the consumer

Figure 5-4 -In Figure 5-4,the rightward shift in budget lines from the one containing point A to the one containing point B

A budget line is a straight line designed to show

Scarcity raises both price and marginal utility but generally reduces total utility.

Figure 5-4 -The budget line facing a household includes information on

Why is gold very expensive,even though it is not essential to life,while water,which is essential to life,is inexpensive?

A consumer cannot gain consumer's surplus if she purchases more than one unit of a good.

The demand curve can be derived from indifference curves by varying the price of the commodity in question.

Utility is the pleasure,satisfaction,or enjoyment derived from consumption.

Marginal utility can fall even as total utility from the consumption of a good is rising.

All decisions involve opportunity cost.

Because the consumer's budget is limited,purchase decisions among available goods must of necessity be interdependent.

High price and low total utility indicate

Lana spent $5 to see a movie.We know

Figure 5-3 -Assume the market consists of three consumers with the demand curves in Figure 5-3.At a price of 1,the total market demand is