Exam 5: The Demand Curve and the Behavior of Consumers

If price and marginal benefit are equal for an individual,and preferences and income do not change,the individual can be induced to buy more of a good only by

An increase in income causes a consumer's budget constraint to shift outward.

Suppose that a consumer's total benefit is $4 for consuming one cup of ice cream and $7 for consuming two cups of ice cream.The consumer's willingness to pay for the second cup of ice cream is

Using the information in Exhibit 5-4,which of the following combinations is preferred to 3 apples and 2 cans of cola?

Different prices might be charged for the same good for all the following reasons except

Exhibit 5-7 -Exhibit 5-7 shows the willingness of Monet and Andrew to pay for latte.If the market price of one cup of latte is $2,then the total demand for latte equals

As more of a good is consumed by an individual,

If an individual's preferences can be illustrated using the concept of utility,why can't individuals' utilities be compared?

Economists generally assume that a consumer

Exhibit 5-4 The numbers inside the box below give the utility from consuming the amount of apples and the number of cans of cola shown outside the box. -Refer to Exhibit 5-4.Which of the following is the combination that gives the first preference?

Which of the following statements is true? The income effect of an increase in the price of iPads refers to the (A)reduction of income incurred by iPad producers. (B)decrease in the quantity demanded of iPads as buyers experience lower real incomes. (C)decrease in the quantity demanded of iPads as buyers experience lower nominal incomes.

The market demand curve is the sum of all the individual demand curves.

Define consumer surplus.Does a consumer really get a surplus? Why or why not?

The height of a demand curve is consumer surplus.

Explain how it is possible for marginal utility to decrease as total utility increases.

The budget constraint is the set of all prices of the goods an individual regularly consumes.

Suppose Jose receives diminishing marginal benefits from consuming more cups of latte.Do you think that Jose may eventually receive negative marginal benefits from consuming an additional cup of latte?

Does an increase in income always increase demand? Why or why not?

Individual demand tells us the

When there is an increase in the consumption of one good and a decrease in the consumption of another,utility