Exam 1: An Introduction to Microeconomics

Figure 3-1 shows the preferences of a consumer toward reading books and watching movies. -Refer to Figure 3-1.ref SHAPE \* MERGEFORMAT Which of the following is the point at which the consumer maximizes his utility?

Incorporating altruistic preferences into the theory of consumer choice:

If the marginal utility of an extra hamburger is 8 utils,the marginal utility of a soft drink is 5 utils,the price of a hamburger is $1,and the price of a soft drink is 50 cents,then the consumer can achieve equilibrium when:

Suppose you have hamburgers on the horizontal axis and root beer on the vertical axis.If the price of hamburgers increased,how would this be shown using the income constraint?

The assumption of completeness of preferences states that _____.

Suppose initially that the price of X is $5,the price of Y is $10,and the consumer's income is $100.If Y is measured on the vertical axis,X is measured on the horizontal axis,and the price of Y increases to $20:

The set of indifference curves that show that a consumer remains equally well off by substituting one good for another at a constant rate must be _____.

At any point on an indifference curve,the slope indicates:

When the income-consumption curve is upward-sloping to the right,the good represented on the X-axis must be _____.

Jen does not care one way or another about blue jeans.In other words,blue jeans are a(n)_____ for Jen.

An example of goods which are perfect complements in consumption is:

You buy only apples and bananas.Your budget is such that you can purchase 3 apples and 4 bananas or 9 apples and 2 bananas.Write down the equation for the budget line with bananas on the Y-axis.Is that equation unique?

Convexity of indifference curves implies that _____.

Suppose there are two goods,X and Y,with X measured on the horizontal axis and Y measured on the vertical axis.Which of the following statements about a budget line relating the two goods is correct?

Nonsatiation implies that marginal utility is:

Consumer theory does not specify which goods people consider economic "goods" and which economic "bads".It nonetheless remains useful because:

Table 3-1 shows the total utility from the consumption of various units of avocadoes. Table 3-1 Units of avocadoes Total utility 1 5 2 10 3 15 4 14 5 9 -Refer to Table 3-1.Diminishing marginal utility sets in from the _____ avocado.

Figure 3-2 shows the preferences of a consumer for two goods,guns and butter. -Refer to Figure 3-2.Which of the following is true?

Which of the following correctly describes an income-consumption curve?

The diminishing marginal rate of substitution along an indifference curve is reflected by its _____.