Question 1

The price of X is $20 and the price of Y is $40.  
-According to the following graph,at what price of Y are Y2 units demanded?   The consumer's income is $1,200.

Accepted Answer

A) $ 8 
B) $10 
C) $15 
D) $16 
E) $12 
A) $ 8 
B) $10 
C) $15 
D) $16 
E) $12

Question 2

The consumer chooses the bundle of goods that maximizes his utility and spends all his income.Which of the following statements is correct?

Accepted Answer

A) The marginal utilities of all goods are equal. 
B) Expenditures on all goods are equal. 
C) The addition to utility of the last unit of the good is equal across all goods. 
D) The addition to utility of the last unit of the good per dollar is equal across all goods. 
A) The marginal utilities of all goods are equal. 
B) Expenditures on all goods are equal. 
C) The addition to utility of the last unit of the good is equal across all goods. 
D) The addition to utility of the last unit of the good per dollar is equal across all goods.

Question 3

Ms.Birnbaum is buying bottles of beer and bags of pretzels.The marginal utility of the last bottle of beer is 60 and the marginal utility of the last bag of pretzels is 30.The price of beer is $0.30 per bottle and the price of pretzels is $0.20 per bag.Ms.Birnbaum

Accepted Answer

A) is buying beer and pretzels in the utility-maximizing amounts. 
B) should buy more beer and fewer pretzels. 
C) should buy more pretzels and less beer. 
D) is not spending all her income. 
A) is buying beer and pretzels in the utility-maximizing amounts. 
B) should buy more beer and fewer pretzels. 
C) should buy more pretzels and less beer. 
D) is not spending all her income.

Question 4

Assume James purchases only two goods,steak and chicken,with his weekly income of $60.The price of steak is $10 and the price of chicken is $5.The following table shows the marginal utility James gets from each additional pound of steak and chicken:   Given the above information,what quantities of steak and chicken should James purchase to maximize his utility?

Accepted Answer

A) 3 steak,2 chicken 
B) 5 steak,2 chicken 
C) 4 steak,4 chicken 
D) 2 steak,5 chicken 
E) none of the above 
A) 3 steak,2 chicken 
B) 5 steak,2 chicken 
C) 4 steak,4 chicken 
D) 2 steak,5 chicken 
E) none of the above

Question 5

Refer to the following indifference map for a consumer who has an income of $48 to spend on goods X and Y and the market prices of X and Y are both $4:   In order to maximize utility subject to her budget constraint,this consumer should buy how many units of good X?

Accepted Answer

A) 0 
B) 4 
C) 6 
D) 8 
E) 12 
A) 0 
B) 4 
C) 6 
D) 8 
E) 12

Question 6

typical indifference curve

Accepted Answer

A) shows all combinations of goods that give a consumer the same level of utility. 
B) shows that as a consumer has more of a good he is less willing to exchange it for one unit of another good. 
C) shifts out if income increases. 
D) both a and b 
E) all of the above 
A) shows all combinations of goods that give a consumer the same level of utility. 
B) shows that as a consumer has more of a good he is less willing to exchange it for one unit of another good. 
C) shifts out if income increases. 
D) both a and b 
E) all of the above

Question 7

rate at which a consumer is ABLE to substitute one good for another is determined by

Accepted Answer

A) the indifference map. 
B) the marginal rate of substitution. 
C) the consumer's income. 
D) the budget line 
A) the indifference map. 
B) the marginal rate of substitution. 
C) the consumer's income. 
D) the budget line

Question 8

Based on the following graph,one point on the consumer's demand curve for X is   The consumer's income is $600.

Accepted Answer

A) 60 units at a price of $10. 
B) 35 units at a price of $10. 
C) 35 units at a price of $6. 
D) 25 units at a price of $10. 
E) 25 units at a price of $7.50. 
A) 60 units at a price of $10. 
B) 35 units at a price of $10. 
C) 35 units at a price of $6. 
D) 25 units at a price of $10. 
E) 25 units at a price of $7.50.

Question 9

Along an indifference curve

Accepted Answer

A) the MRS is constant. 
B) the ratio of the marginal utilities is constant. 
C) the price ratio is constant. 
D) all of the above 
E) none of the above 
A) the MRS is constant. 
B) the ratio of the marginal utilities is constant. 
C) the price ratio is constant. 
D) all of the above 
E) none of the above

The price of X is $20 and the price of Y is $40. -According to the following graph,at what price of Y are Y₂ units demanded? The consumer's income is $1,200.

The consumer chooses the bundle of goods that maximizes his utility and spends all his income.Which of the following statements is correct?

Ms.Birnbaum is buying bottles of beer and bags of pretzels.The marginal utility of the last bottle of beer is 60 and the marginal utility of the last bag of pretzels is 30.The price of beer is $0.30 per bottle and the price of pretzels is $0.20 per bag.Ms.Birnbaum

Refer to the following indifference map for a consumer who has an income of $48 to spend on goods X and Y and the market prices of X and Y are both $4: In order to maximize utility subject to her budget constraint,this consumer should buy how many units of good X?

typical indifference curve

rate at which a consumer is ABLE to substitute one good for another is determined by

Based on the following graph,one point on the consumer's demand curve for X is The consumer's income is $600.

Along an indifference curve

Managers, profits, and Markets

Demand, supply, and Market Equilibrium

Marginal Analysis for Optimal Decision Making

Basic Estimation Techniques

Elasticity and Demand

Demand Estimation and Forecasting

Production and Cost in the Short Run

Production and Cost in the Long Run

Production and Cost Estimation

Managerial Decisions in Competitive Markets

Managerial Decisions for Firms With Market Power

Strategic Decision Making in Oligopoly Markets

Advanced Pricing Techniques

Decisions Under Risk and Uncertainty

Government Regulation of Business

Filters

Exam 5: Theory of Consumer Behavior

The price of X is $20 and the price of Y is $40. -According to the following graph,at what price of Y are Y2 units demanded? The consumer's income is $1,200.

The consumer chooses the bundle of goods that maximizes his utility and spends all his income.Which of the following statements is correct?

Ms.Birnbaum is buying bottles of beer and bags of pretzels.The marginal utility of the last bottle of beer is 60 and the marginal utility of the last bag of pretzels is 30.The price of beer is $0.30 per bottle and the price of pretzels is $0.20 per bag.Ms.Birnbaum

Refer to the following indifference map for a consumer who has an income of $48 to spend on goods X and Y and the market prices of X and Y are both $4: In order to maximize utility subject to her budget constraint,this consumer should buy how many units of good X?

typical indifference curve

rate at which a consumer is ABLE to substitute one good for another is determined by

Based on the following graph,one point on the consumer's demand curve for X is The consumer's income is $600.

Along an indifference curve

Managers, profits, and Markets

Demand, supply, and Market Equilibrium

Marginal Analysis for Optimal Decision Making

Basic Estimation Techniques

Elasticity and Demand

Demand Estimation and Forecasting

Production and Cost in the Short Run

Production and Cost in the Long Run

Production and Cost Estimation

Managerial Decisions in Competitive Markets

Managerial Decisions for Firms With Market Power

Strategic Decision Making in Oligopoly Markets

Advanced Pricing Techniques

Decisions Under Risk and Uncertainty

Government Regulation of Business

Filters

The price of X is $20 and the price of Y is $40. -According to the following graph,at what price of Y are Y₂ units demanded? The consumer's income is $1,200.