Exam 1: An Introduction to Microeconomics

Suppose hamburgers are on the horizontal axis and root beer on the vertical axis.Your budget allowance is $10 and the price of hamburgers is $4 each and root beer $2 each.If at your present consumption of hamburger and root beer your marginal rate of substitution of hamburger for root beer is 4,to maximize utility you should:

Suppose movie theater tickets are on the vertical axis and books on the horizontal axis.You have a budget allowance of $100,and the price of movie theater passes is $10 and the price of books is $25 each.What is the vertical intercept of your budget constraint?

Good Y is measured on the vertical axis and good X on the horizontal axis.If the price of Y is zero,the price of X is $10,and the consumer's income $100,the budget line:

Along an indifference curve,if the MRS of food (F)for clothing (C)is 1F/2C,this means the consumer:

When a consumer's optimal consumption choice is a corner equilibrium it implies:

Suppose hamburger is on the horizontal axis and pizza on the vertical axis.If you were consuming at a point on a convex indifference curve such that the slope at that point was -4,which of the following best describes your consumption bundle?

The consumption of the composite good is measured by:

Figure 3-1 shows the preferences of a consumer toward reading books and watching movies. -Refer to Figure 3-1.Given that the price of a book is $4 and a movie ticket costs $5,the consumer's marginal rate of substitution in equilibrium equals _____.

A set of indifference curves showing that the consumer is indifferent between market baskets A and B,and market baskets A and C,but that market basket C is preferred to B must be _____.

An indifference map shows the optimal consumption bundle of a consumer for two goods A and B.Which of the following factors would lead to a parallel shift of the budget line allowing the consumer to reach a higher indifference curve?

In deriving an income-consumption curve,it is assumed that:

An income consumption curve (shown on an indifference map with Ben's income on the horizontal axis and Jerry's income on the vertical axis)is positively sloped.Given that the indifference curves on the map are downward sloping,which of the followings statements is true?

Perfect complements are associated with _____ indifference curves.

How do inferior goods differ from economic "bads"?

Indifference curves consistent with one good being an economic "neuter" are:

When a consumer is in equilibrium this means that he or she is:

The Lagrangian method of optimization results in a new variable, $\lambda$ ,called the Lagrangian multiplier,which shows the additional to total utility from an additional unit of income.In other words, $\lambda$ expresses the:

A low-fat decaf vanilla latte is more likely to be an inferior good than coffee in general because:

When the income-consumption curve is backward-bending to the left,the good represented on the X-axis must be _____.

Intersecting indifference curves violate the assumption of _____.