Deck 6: Consumer Choice and Demand

Question 1

According to the law of _____,the marginal utility received from each additional unit of a good consumed declines,other things constant.

A)increasing marginal returns
B)marginal rate of substitution
C)supply
D)diminishing marginal utility
E)increasing marginal rate of substitution

Answer 1

D

Question 2

Utility is determined by _____.

A)consumer income
B)the prices of goods and services
C)the consumer surplus of all buyers in a market
D)consumer expenditure
E)consumer tastes and preferences

Answer 2

E

Question 3

Which of the following illustrates the law of diminishing marginal utility?

A)The marginal utility of Diane's second Coke is greater than the marginal utility of her third pretzel, other things constant.
B)The marginal utility of Diane's second Coke is greater than the marginal utility of Ken's third pretzel, other things constant.
C)The marginal utility of Diane's second Coke is greater than the marginal utility of her third Coke, other things constant.
D)The total utility of one Coke is greater than the total utility of two Cokes, other things constant.
E)The marginal utility of Diane's second Coke is greater than the marginal utility of Ken's third Coke, other things constant.

Answer 3

C

Question 4

Consumer tastes and preferences _____

A)are determined solely by advertising.
B)are relatively stable over time.
C)do not vary from one consumer to another.
D)are irrelevant to utility analysis.
E)can be measured in terms of units of utility.

Question 5

Utility measures _____

A)tastes and preferences in consumption.
B)the difference in total satisfaction.
C)the quality of products.
D)the durability of products.
E)the usefulness of products.

Question 6

The reason why Diana does not drink five cups of coffee at breakfast is that _____

A)the marginal utility derived from the fifth cup of coffee is negative.
B)the marginal satisfaction derived from the fifth cup of coffee rises.
C)the total utility from the consumption of coffee rises as she consumes more coffee.
D)the total utility from the consumption of coffee becomes negative as she consumes more coffee.
E)the marginal satisfaction derived from all five cups of coffee is constant.

Question 7

Which of the following is true?

A)Different people may have different tastes, but an individual's tastes are constantly in flux.
B)Different people may have different tastes, but an individual's tastes are relatively stable.
C)Different people may have the same tastes, but an individual's tastes are relatively stable.
D)Different people may have the same tastes, but an individual's tastes are constantly in flux.
E)The same people may have the same tastes, but an individual's tastes are constantly in flux.

Question 8

Consumer preferences _____

A)do not vary from one consumer to another.
B)have little to do with personal tastes and income.
C)are not influenced by the utility derived from a particular good.
D)determine the utility derived from goods.
E)can be objectively measured and compared across individuals.

Question 9

Utility is _____

A)the sense of pleasure or satisfaction derived from consuming goods and services.
B)the addition to total satisfaction resulting from an additional unit of consumption.
C)the ratio of the units of a good consumed to its price.
D)objectively measured and compared across individuals.
E)the difference in the total satisfaction derived from the consumption of any two products.

Question 10

Utility is _____

A)easily measured because of consumption.
B)easily measured because it is an objective concept.
C)easily measured because it is a subjective concept.
D)hard to measure because it is a subjective concept.
E)hard to measure because it is an objective concept.

Question 11

Which of the following statements is not true of consumer preferences?

A)Pat enjoys her second cotton candy less than her first.
B)Bill enjoys his third cotton candy less than his second.
C)Arnie enjoys two cotton candies more than one cotton candy.
D)Arnie enjoys two cotton candies more than Pat enjoys one cotton candy.
E)Bill and Arnie enjoy their third cotton candies less than their first.

Question 12

Which of the following statements is true of utility?

A)It is possible to precisely measure the utility an individual receives from consuming a particular good or service.
B)It is always possible to determine whether Darlene or Julie gets more utility from consuming two units of the same good.
C)The utility of goods can be measured, while that of services cannot.
D)Utility is a subjective measure of satisfaction an individual receives from consuming a good or service.
E)The concept of utility is useful only if there is no scarcity.

Question 13

The law of diminishing marginal utility states that as one consumes more and more of a good,other things constant,_____

A)total utility keeps on increasing.
B)marginal utility always stays positive.
C)marginal utility approaches but never becomes zero.
D)marginal utility keeps on increasing.
E)marginal utility eventually declines.

Question 14

Diminishing marginal utility means that _____

A)as one consumes more of a good, other things constant, the total satisfaction obtained from consuming the good tends to fall.
B)as one hires more labor, other things constant, the total amount of output produced begins to fall.
C)as one hires more units of labor, other things constant, the marginal product of labor begins to fall.
D)as one consumes more of a good, other things constant, the additional satisfaction obtained from each additional unit of the good tends to fall.
E)as one consumes more of a good, other things constant, the extra satisfaction obtained from each extra good becomes negative.

Question 15

Marginal utility is _____

A)the total satisfaction derived from consuming a given amount of a product.
B)the addition to total satisfaction resulting from an additional unit of consumption.
C)the difference in the total satisfaction derived from the consumption of any two products.
D)the cost of consuming one more unit of a good.
E)the average satisfaction per unit of consumption.

Question 16

The marginal utility of a second copy of today's New York Times is _____

A)infinite.
B)practically zero.
C)positive and greater than the marginal utility of the first copy.
D)equal to the marginal utility of the first copy.
E)50 cents.

Question 17

Marginal utility is the _____

A)overall satisfaction obtained from consuming a good.
B)additional satisfaction obtained from consuming one more unit of a good.
C)average satisfaction obtained from consuming a good.
D)increase in satisfaction that results from reducing the consumption of a good by one percent.
E)additional cost of purchasing one more unit of a good.

Question 18

In economics,tastes and preferences refer to _____

A)consumption.
B)income.
C)prices.
D)utility.
E)trends.

Question 19

Total utility is the _____

A)sum of all marginal utilities.
B)price paid for one unit of a good.
C)product of all marginal utilities.
D)total expenditure on all units of a good a consumer buys.
E)difference between the marginal utilities of the first and the second unit of a good consumed.

Question 20

The law of diminishing marginal utility states that _____

A)total utility falls as more of a good is consumed, other things constant.
B)total utility falls as marginal utility falls, other things constant.
C)marginal utility increases as total utility falls, other things constant.
D)marginal utility falls as more of a good is consumed, other things constant.
E)marginal utility falls as less of a good is consumed, other things constant.

Question 21

"The second glass of Evian water was very good.May I have another?" Which of the following is necessarily true of this statement?

A)The marginal utility of the second glass of water was negative.
B)The marginal utility of the first glass of water was zero.
C)The marginal utility of the second glass of water was positive.
D)The water is available free of cost.
E)The marginal utility of the third glass of water will be negative.

Question 22

Negative marginal utility implies that _____

A)total utility is negative.
B)marginal utility increases as additional units of a good are consumed.
C)the price of a good increases as additional units are consumed.
D)the total revenue spent by a consumer on a good decreases as more of the good is purchased.
E)total utility decreases as additional units of a good are consumed.

Question 23

When would a consumer experience disutility?

A)if total utility is increasing and marginal utility is decreasing
B)if total utility is decreasing and marginal utility is increasing
C)if total utility is increasing and marginal utility is zero
D)if total utility is increasing and marginal utility is greater than zero
E)if marginal utility is negative

Question 24

"I don't feel so good; I shouldn't have had that last doughnut." Which of the following supports this statement?

A)The marginal utility of the last doughnut was positive.
B)The marginal utility of doughnuts is still increasing.
C)The total utility from eating doughnuts is negative.
D)The marginal utility of the last doughnut was negative.
E)The marginal utility of the next doughnut will be positive.

Question 25

Carvel advertises a football-shaped ice cream cake for $7; you can buy a second one for only $4.What does Carvel know about consumer preferences?

A)Consumers would never buy a second ice cream cake.
B)Two cakes are worth less to a consumer than one.
C)The marginal utility of ice cream cakes diminishes.
D)Consumers only value the first cake at $4.
E)Consumers value all cakes they eat at $4.

Question 26

Table 6.1
$$\begin{array} { | c | c | } \hline \text { Pretzels } & \text { Marginal Utility } \\\hline 1 & 30 \\\hline 2 & 20 \\\hline 3 & 5 \\\hline 4 & 2 \\\hline\end{array}$$

-Refer to Table 6.1,which shows the marginal utility of each additional unit of pretzel for a consumer.The first column of the table shows the number of pretzels consumed in a day,and the second column of the table shows the marginal utility of each additional unit of pretzel.The total utility derived from the consumption of three pretzels is _____ units.

A)5
B)15
C)55
D)57
E)70

Question 27

If you ordered the all-you-can-eat special,you continue to eat as long as _____

A)your actual marginal utility from another bite is positive.
B)your actual marginal utility from another bite is negative.
C)your expected marginal utility from another bite is positive.
D)your expected marginal utility from another bite is negative.
E)your expected marginal utility from another bite is zero.

Question 28

Table 6.1
$$\begin{array} { | c | c | } \hline \text { Pretzels } & \text { Marginal Utility } \\\hline 1 & 30 \\\hline 2 & 20 \\\hline 3 & 5 \\\hline 4 & 2 \\\hline\end{array}$$

-Refer to Table 6.1,which shows the marginal utility of each additional unit of pretzel for a consumer.The first column of the table shows the number of pretzels consumed in a day,and the second column of the table shows the marginal utility of each additional unit of pretzel.The marginal utility of the third pretzel is _____ units.

A)5
B)10
C)55
D)2
E)57

Question 29

Which of the following is correct?

A)If total utility is increasing, then marginal utility is decreasing.
B)If total utility is decreasing, then marginal utility is increasing.
C)If total utility is increasing, then marginal utility is zero.
D)If total utility is increasing, then marginal utility is greater than zero.
E)If marginal utility is increasing, then marginal utility is less than zero.

Question 30

Table 6.1
$$\begin{array} { | c | c | } \hline \text { Pretzels } & \text { Marginal Utility } \\\hline 1 & 30 \\\hline 2 & 20 \\\hline 3 & 5 \\\hline 4 & 2 \\\hline\end{array}$$

-Refer to Table 6.1,which shows the marginal utility of each additional unit of pretzel for a consumer.The first column of the table shows the number of pretzels consumed in a day,and the second column of the table shows the marginal utility of each additional unit of pretzel.Total utility is _____ and marginal utility is _____ with the consumption of each extra pretzel.

A)increasing; decreasing
B)increasing; increasing
C)decreasing; increasing
D)decreasing; decreasing
E)increasing; staying the same

Question 31

Table 6.2
$$\begin{array} { | c | c | } \hline \text { Units Consumed } & \text { Total Utility } \\\hline 0 & 0 \\\hline 1 & 30 \\\hline 2 & 65 \\\hline 3 & 85 \\\hline 4 & 89 \\\hline 5 & 88 \\\hline\end{array}$$

-Refer to Table 6.2,which shows the total utility derived from the consumption of a good.The first column of the table shows the number of units of the good consumed in a day,and the second column of the table shows the total utility derived from that consumption.What is the marginal utility of consuming the third unit?

A)0
B)30
C)35
D)20
E)65

Question 32

Table 6.2
$$\begin{array} { | c | c | } \hline \text { Units Consumed } & \text { Total Utility } \\\hline 0 & 0 \\\hline 1 & 30 \\\hline 2 & 65 \\\hline 3 & 85 \\\hline 4 & 89 \\\hline 5 & 88 \\\hline\end{array}$$

-Refer to Table 6.2,which shows the total utility derived from the consumption of a good.The first column of the table shows the number of units of the good consumed in a day,and the second column of the table shows the total utility derived from that consumption.What is the marginal utility of consuming the first unit?

A)0
B)30
C)35
D)20
E)65

Question 33

Which of the following is true of units of utility?

A)They evaluate the purchasing power of consumers.
B)They cannot be compared across consumers.
C)They apply to goods but not to services.
D)They do not exist for very wealthy individuals.
E)They are negative for inferior goods.

Question 34

Table 6.1
$$\begin{array} { | c | c | } \hline \text { Pretzels } & \text { Marginal Utility } \\\hline 1 & 30 \\\hline 2 & 20 \\\hline 3 & 5 \\\hline 4 & 2 \\\hline\end{array}$$

-Refer to Table 6.1,which shows the marginal utility of each additional unit of pretzel for a consumer.The first column of the table shows the number of pretzels consumed in a day,and the second column of the table shows the marginal utility of each additional unit of pretzel.The marginal utility of the third pretzel is _____ units.

A)5
B)10
C)55
D)2
E)57

Question 35

Table 6.2
$$\begin{array} { | c | c | } \hline \text { Units Consumed } & \text { Total Utility } \\\hline 0 & 0 \\\hline 1 & 30 \\\hline 2 & 65 \\\hline 3 & 85 \\\hline 4 & 89 \\\hline 5 & 88 \\\hline\end{array}$$

-Refer to Table 6.2,which shows the total utility derived from the consumption of a good.The first column of the table shows the number of units of the good consumed in a day,and the second column of the table shows the total utility derived from that consumption.What is the marginal utility of consuming the second unit?

A)0
B)30
C)35
D)20
E)65

Question 36

Which of the following is true of units of utility?

A)It allows us to be more uncertain about the utility of consumption.
B)It allows us to be more specific about the utility of consumption.
C)It allows us to be more unique about the utility of consumption.
D)It allows us to be more objective about the utility of satisfaction.
E)It allows us to be more subjective about the utility of consumption.

Question 37

If marginal utility is positive,then total utility is _____

A)constant.
B)negative.
C)increasing.
D)decreasing.
E)zero.

Question 38

When total utility falls,marginal utility is _____

A)at its maximum.
B)infinite.
C)positive.
D)negative.
E)zero.

Question 39

Newspaper vending machines,from which customers could take more than one paper for the same amount of money if they so desired,illustrate the publishers' belief that the _____

A)average utility of two identical newspapers is zero or less.
B)total utility from two identical newspapers is zero or less.
C)marginal utility of a second identical newspaper is zero or less.
D)marginal utility of a second identical newspaper is greater than the marginal utility of the first newspaper.
E)total utility from two identical newspapers is less than the total utility from the first newspaper.

Question 40

When total utility is maximized,marginal utility is _____

A)at its maximum.
B)infinite.
C)positive.
D)negative.
E)zero.

Question 41

Table 6.4
$$\begin{array} { | c | c | } \hline \text { Chocolate Bars } & \text { Total Utility } \\\hline 1 & 10 \\\hline 2 & 25 \\\hline 3 & \\\hline 4 & 60 \\\hline 5 & 70 \\\hline\end{array}$$

-Refer to Table 6.4,which shows a utility schedule for a consumer's consumption of chocolate bars.The marginal utility of the second chocolate bar is _____ units.

A)2
B)70
C)45
D)15
E)10

Question 42

Table 6.4
$$\begin{array} { | c | c | } \hline \text { Chocolate Bars } & \text { Total Utility } \\\hline 1 & 10 \\\hline 2 & 25 \\\hline 3 & \\\hline 4 & 60 \\\hline 5 & 70 \\\hline\end{array}$$

-Refer to Table 6.4,which shows a utility schedule for a consumer's consumption of chocolate bars.The total utility derived from the consumption of one chocolate bar is _____ units.

A)2
B)70
C)45
D)15
E)10

Question 43

Table 6.2
$$\begin{array} { | c | c | } \hline \text { Units Consumed } & \text { Total Utility } \\\hline 0 & 0 \\\hline 1 & 30 \\\hline 2 & 65 \\\hline 3 & 85 \\\hline 4 & 89 \\\hline 5 & 88 \\\hline\end{array}$$

-Refer to Table 6.2,which shows the total utility derived from the consumption of a good.The first column of the table shows the number of units of the good consumed in a day,and the second column of the table shows the total utility derived from that consumption.The marginal utility of an additional unit of the good diminishes after the consumption of the _____ unit of the good.

A)first
B)second
C)third
D)fourth
E)fifth

Question 44

Table 6.3
$$\begin{array} { | c | c | c | } \hline \text { Scones } & \text { Total Utility } & \text { Marginal Utility } \\\hline 1 & 10 & - \\\hline 2 & 18 & - \\\hline 3 & 24 & 6 \\\hline 4 & 28 & - \\\hline 5 & 30 & 2 \\\hline\end{array}$$

-Refer to Table 6.3,which shows the total utility and marginal utility derived from the consumption of scones.The first column of the table represents the number of scones a consumer consumes in a day.The second column of the table presents the total utility derived from that consumption,and the third column shows the marginal utility of each additional scone.The total utility derived from the consumption of three scones is _____ units.

A)34
B)6
C)22
D)12
E)24

Question 45

Table 6.5
$$\begin{array} { | c | c | } \hline \text { Plums } & \text { Total Utility } \\\hline 0 & 0 \\\hline 1 & 10 \\\hline 2 & 18 \\\hline 3 & 24 \\\hline 4 & 28 \\\hline 5 & 30 \\\hline\end{array}$$

-Refer to Table 6.5,which shows the total utility and marginal utility derived from the consumption of plums.The first column of the table represents the number of plums a consumer consumes in a day,and the second column of the table presents the total utility derived from that consumption.The total utility of eating the first plum is _____

A)4 units.
B)6 units.
C)8 units.
D)10 units.
E)24 units.

Question 46

Table 6.2
$$\begin{array} { | c | c | } \hline \text { Units Consumed } & \text { Total Utility } \\\hline 0 & 0 \\\hline 1 & 30 \\\hline 2 & 65 \\\hline 3 & 85 \\\hline 4 & 89 \\\hline 5 & 88 \\\hline\end{array}$$

-Refer to Table 6.2,which shows the total utility derived from the consumption of a good.The first column of the table shows the number of units of the good consumed in a day,and the second column of the table shows the total utility derived from that consumption.What happens to marginal utility of consuming the fifth good?

A)It increases.
B)It stays the same.
C)It Is more than zero.
D)It is less than zero.
E)It Is zero.

Question 47

Table 6.3
$$\begin{array} { | c | c | c | } \hline \text { Scones } & \text { Total Utility } & \text { Marginal Utility } \\\hline 1 & 10 & - \\\hline 2 & 18 & - \\\hline 3 & 24 & 6 \\\hline 4 & 28 & - \\\hline 5 & 30 & 2 \\\hline\end{array}$$

-Refer to Table 6.3,which shows the total utility and marginal utility derived from the consumption of scones.The first column of the table represents the number of scones a consumer consumes in a day.The second column of the table presents the total utility derived from that consumption,and the third column shows the marginal utility of each additional scone.The marginal utility of the second scone is _____ units.

A)2
B)4
C)6
D)8
E)10

Question 48

Table 6.3
$$\begin{array} { | c | c | c | } \hline \text { Scones } & \text { Total Utility } & \text { Marginal Utility } \\\hline 1 & 10 & - \\\hline 2 & 18 & - \\\hline 3 & 24 & 6 \\\hline 4 & 28 & - \\\hline 5 & 30 & 2 \\\hline\end{array}$$

-Refer to Table 6.3,which shows the total utility and marginal utility derived from the consumption of scones.The first column of the table represents the number of scones a consumer consumes in a day.The second column of the table presents the total utility derived from that consumption,and the third column shows the marginal utility of each additional scone.The marginal utility of the first scone is _____ units.

A)0
B)2
C)8
D)9
E)10

Question 49

Table 6.3
$$\begin{array} { | c | c | c | } \hline \text { Scones } & \text { Total Utility } & \text { Marginal Utility } \\\hline 1 & 10 & - \\\hline 2 & 18 & - \\\hline 3 & 24 & 6 \\\hline 4 & 28 & - \\\hline 5 & 30 & 2 \\\hline\end{array}$$

-Refer to Table 6.3,which shows the total utility and marginal utility derived from the consumption of scones.The first column of the table represents the number of scones a consumer consumes in a day.The second column of the table presents the total utility derived from that consumption,and the third column shows the marginal utility of each additional scone.The total utility derived from the consumption of five scones is _____ units.

A)82
B)30
C)34
D)27
E)2

Question 50

Table 6.4
$$\begin{array} { | c | c | } \hline \text { Chocolate Bars } & \text { Total Utility } \\\hline 1 & 10 \\\hline 2 & 25 \\\hline 3 & \\\hline 4 & 60 \\\hline 5 & 70 \\\hline\end{array}$$

-Refer to Table 6.4,which shows a utility schedule for a consumer's consumption of chocolate bars.The marginal utility of the first chocolate bar is _____ units.

A)2
B)70
C)45
D)15
E)10

Question 51

Table 6.5
$$\begin{array} { | c | c | } \hline \text { Plums } & \text { Total Utility } \\\hline 0 & 0 \\\hline 1 & 10 \\\hline 2 & 18 \\\hline 3 & 24 \\\hline 4 & 28 \\\hline 5 & 30 \\\hline\end{array}$$

-Refer to Table 6.5,which shows the total utility and marginal utility derived from the consumption of plums.The first column of the table shows the number of plums a consumer consumes in a day,and the second column shows the total utility derived from that consumption.The marginal utility of the first plum is _____

A)4 units.
B)6 units.
C)8 units.
D)10 units.
E)24 units.

Question 52

Table 6.4
$$\begin{array} { | c | c | } \hline \text { Chocolate Bars } & \text { Total Utility } \\\hline 1 & 10 \\\hline 2 & 25 \\\hline 3 & \\\hline 4 & 60 \\\hline 5 & 70 \\\hline\end{array}$$

-Refer to Table 6.4,which shows a utility schedule for a consumer's consumption of chocolate bars.The total utility derived from the consumption of five chocolate bars is _____ units.

A)2
B)70
C)45
D)15
E)10

Question 53

Table 6.3
$$\begin{array} { | c | c | c | } \hline \text { Scones } & \text { Total Utility } & \text { Marginal Utility } \\\hline 1 & 10 & - \\\hline 2 & 18 & - \\\hline 3 & 24 & 6 \\\hline 4 & 28 & - \\\hline 5 & 30 & 2 \\\hline\end{array}$$

-Refer to Table 6.3,which shows the total utility and marginal utility derived from the consumption of scones.The first column of the table represents the number of scones a consumer consumes in a day.The second column of the table presents the total utility derived from that consumption,and the third column shows the marginal utility of each additional scone.The total utility derived from the consumption of one scone is _____ units.

A)2
B)4
C)6
D)8
E)10

Question 54

Table 6.2
$$\begin{array} { | c | c | } \hline \text { Units Consumed } & \text { Total Utility } \\\hline 0 & 0 \\\hline 1 & 30 \\\hline 2 & 65 \\\hline 3 & 85 \\\hline 4 & 89 \\\hline 5 & 88 \\\hline\end{array}$$

-Refer to Table 6.2,which shows the total utility derived from the consumption of a good.The first column of the table shows the number of units of the good consumed in a day,and the second column of the table shows the total utility derived from that consumption.Marginal utility is maximized after the consumption of how many units?

A)0
B)1
C)2
D)3
E)5

Question 55

Table 6.4
$$\begin{array} { | c | c | } \hline \text { Chocolate Bars } & \text { Total Utility } \\\hline 1 & 10 \\\hline 2 & 25 \\\hline 3 & 45 \\\hline 4 & 60 \\\hline 5 & 70 \\\hline\end{array}$$

-Refer to Table 6.4,which shows a utility schedule for a consumer's consumption of chocolate bars.Marginal utility decreases after the consuming the _____ bar.

A)fifth
B)third
C)first
D)second
E)fourth

Question 56

Table 6.5
$$\begin{array} { | c | c | } \hline \text { Plums } & \text { Total Utility } \\\hline 0 & 0 \\\hline 1 & 10 \\\hline 2 & 18 \\\hline 3 & 24 \\\hline 4 & 28 \\\hline 5 & 30 \\\hline\end{array}$$

-Refer to Table 6.5,which shows the total utility and marginal utility derived from the consumption of plums.The first column of the table represents the number of plums a consumer consumes in a day,and the second column of the table presents the total utility derived from that consumption.The marginal utility of the fifth plum is _____

A)4 units.
B)6 units.
C)8 units.
D)2 units.
E)24 units.

Question 57

Table 6.4
$$\begin{array} { | c | c | } \hline \text { Chocolate Bars } & \text { Total Utility } \\\hline 1 & 10 \\\hline 2 & 25 \\\hline 3 & 45 \\\hline 4 & 60 \\\hline 5 & 70 \\\hline\end{array}$$

-Refer to Table 6.4,which shows a utility schedule for a consumer's consumption of chocolate bars.The marginal utility of the fourth chocolate bar is _____ units.

A)2
B)70
C)45
D)15
E)10

Question 58

Table 6.4
$$\begin{array} { | c | c | } \hline \text { Chocolate Bars } & \text { Total Utility } \\\hline 1 & 10 \\\hline 2 & 25 \\\hline 3 & \\\hline 4 & 60 \\\hline 5 & 70 \\\hline\end{array}$$

-Refer to Table 6.4,which shows a utility schedule for a consumer's consumption of chocolate bars.If the marginal utility of consuming the third bar is 20,the total utility derived from the consumption of three chocolate bars is _____ units.

A)2
B)70
C)45
D)15
E)10

Question 59

Table 6.5
$$\begin{array} { | c | c | } \hline \text { Plums } & \text { Total Utility } \\\hline 0 & 0 \\\hline 1 & 10 \\\hline 2 & 18 \\\hline 3 & 24 \\\hline 4 & 28 \\\hline 5 & 30 \\\hline\end{array}$$

-Refer to Table 6.5,which shows the total utility and marginal utility derived from the consumption of plums.The first column of the table represents the number of plums a consumer consumes in a day,and the second column of the table presents the total utility derived from that consumption.The marginal utility of eating the third plum is _____

A)4 units.
B)6 units.
C)8 units.
D)2 units.
E)24 units.

Question 60

Table 6.3
$$\begin{array} { | c | c | c | } \hline \text { Scones } & \text { Total Utility } & \text { Marginal Utility } \\\hline 1 & 10 & - \\\hline 2 & 18 & - \\\hline 3 & 24 & 6 \\\hline 4 & 28 & - \\\hline 5 & 30 & 2 \\\hline\end{array}$$

-Refer to Table 6.3,which shows the total utility and marginal utility derived from the consumption of scones.The first column of the table represents the number of scones a consumer consumes in a day.The second column of the table presents the total utility derived from that consumption,and the third column shows the marginal utility of each additional scone.The marginal utility of the fourth scone is _____ units.

A)4
B)7
C)6
D)24
E)2

Question 61

Suppose Shawn dines at a restaurant that serves clams at a fixed price and crab legs at a varied,market-determined price.The marginal utility of an order of crab legs is 100 units,and the marginal utility of an order of clams is 50 units.Shawn orders crab legs in one week,but he orders clams in the next week.This means that in the second week _____

A)the price of crab legs has increased three times more than that of clams.
B)the price of clams has dropped three times less than that of clams.
C)the price of clams has dropped four times less than that of clams.
D)the price of clams has increased four times more than that of clams.
E)the price of crab legs has increased more than twice that of clams.

Question 62

Exhibit 6.1

Refer to Exhibit 6.1,which shows the marginal utility (MU)derived by a consumer from the consumption of Pepsi.Which of the following is true of the total utility derived from the consumption of four cans of Pepsi?

A)A fourth can of Pepsi increases total utility by 12 units.
B)A fourth can of Pepsi increases total utility by 18 units.
C)A fourth can of Pepsi increases total utility by 20 units.
D)All four cans of Pepsi together yield a total utility of 114 units.
E)All four cans of Pepsi together yield a total utility of 322 units.

Question 63

Suppose the marginal utility of a unit of Good X = MU_x,the marginal utility of a unit of Good Y = MU_y,P_x = the price of a unit of Good X,and P_y = the price of a unit of a Good Y.A utility-maximizing consumer who purchases two goods,X and Y,allocates her budget in such a way that _____

A)MU_x = MU_y.
B)TU_x = TU_y.
C)MU_x/P_y = MU_y/P_x.
D)TU_x/P_y = TU_y/P_x.
E)MU_x/P_x = MU_y/P_y.

Question 64

Suppose John goes to a wedding reception where free drinks are served.He will drink until the marginal utility of an additional drink is _____

A)infinite.
B)zero.
C)one.
D)less than zero.
E)greater than one.

Question 65

Exhibit 6.2

Refer to Exhibit 6.2,which shows the marginal and total utility derived by a consumer from watching an additional baseball game every month.Which of the following is true of the total and marginal utilities derived from watching the baseball games?

A)For all ten games, total utility decreases as marginal utility decreases.
B)For all ten games, total utility increases as marginal utility increases.
C)For the last four games, both total utility and marginal utility increases.
D)For the first six games, total utility increases as marginal utility decreases.
E)For the first six games, total utility decreases as marginal utility increases.

Question 66

Suppose Sally allocates her budget between two goods,A and B.She spends her entire income on a combination of A and B,for which the ratio of the marginal utility of Good A to its price exceeds the ratio of the marginal utility of Good B to its price.She can increase her total utility by buying _____

A)more A and less B.
B)more B and less A.
C)more A without changing her consumption of B.
D)less B without changing her consumption of A.
E)more B and more A.

Question 67

If Darlene's marginal benefit from consuming another cookie is greater than the price of the cookie,then _____

A)Darlene will not purchase any more cookies, as the opportunity cost of purchasing another cookie will be more than its price.
B)Darlene will purchase more cookies as her total utility is zero.
C)Darlene will purchase more cookies, as her marginal utility will decrease with the additional purchase.
D)Darlene will purchase more cookies, as her marginal utility will increase with the additional purchase.
E)Darlene will not purchase any more cookies ,as a reallocation of her budget will decrease her utility.

Question 68

As a consumer allocates income between Good A and Good B,total utility is maximized when _____

A)the marginal utility of Good A = the marginal utility of Good B.
B)the marginal utility of Good A = the marginal utility of Good B = 0.
C)the price of Good A = the price of Good B.
D)the marginal utility of Good A/the price of Good A = the marginal utility of Good B/the price of Good B = 0.
E)the marginal utility of Good A/the price of Good A = the marginal utility of Good B/the price of Good B.

Question 69

Suppose Enid could increase her total utility by purchasing one more book and one fewer DVD.Which of the following is true?

A)The marginal utility of an additional DVD exceeds the marginal utility of an additional book.
B)The marginal utility of an additional book exceeds the marginal utility of an additional DVD.
C)The marginal utility of an additional DVD is negative.
D)The marginal utility of per dollar spent on books exceeds that of DVDs.
E)The marginal utility of per dollar spent on books equals that of DVDs.

Question 70

According to the utility theory,in "consumer equilibrium," households have _____

A)consumed as much of every commodity as they wanted.
B)spent their incomes in such a way that their overall satisfaction is maximized.
C)spent their incomes in such a way that their marginal utility is maximized.
D)spent their incomes in such a way that their marginal utility is zero for every product consumed.
E)spent their incomes in such a way that their total utility is zero.

Question 71

A consumer's utility is maximized when the marginal utilities derived from additional units of goods _____

A)are less than their market prices.
B)are equal to the total utilities derived from consumption.
C)are maximized.
D)are equal to the opportunity costs of producing additional units of goods.
E)are exactly proportional to their market prices.

Question 72

If Jennie spends her income on ice cream and biscuits and the price of ice cream is three times the price of biscuits,then _____

A)she maximizes her utility by buying equal quantities of ice cream and biscuits.
B)she maximizes her utility by buying three times as much ice cream as biscuits.
C)she maximizes her utility by buying three times as many biscuits as ice cream.
D)she buys biscuits and ice cream until the marginal utility of ice cream is three times the marginal utility of biscuits.
E)she buys biscuits and ice cream until the marginal utility of biscuits is three times the marginal utility of ice cream.

Question 73

Table 6.6
$$\begin{array} { | c | c | c | } \hline{ \text { Quantity } } & { \text { Total Utility } } \\& \text { Games of Billiards } & \text { Games of Bowling } \\\hline 0 & 0 & 0 \\\hline 1 & 100 & 70 \\\hline 2 & 180 & 130 \\\hline 3 & 240 & 180 \\\hline 4 & 272 & 210 \\\hline 5 & 288 & 218 \\\hline 6 & 292 & 222 \\\hline\end{array}$$

-Refer to Table 6.6,which shows John's total utility derived from billiards and bowling games.Assume John has $30 to spend on a game of billiards and/or a game of bowling.A game of billiards costs him $4,and a game of bowling costs him $2.Which of the following is John's utility-maximizing combination of the games of billiards and the games of bowling?

A)four games of billiards and four games of bowling
B)five games of billiards and two games of bowling
C)three games of billiards and eight games of bowling
D)five games of billiards and five games of bowling
E)twelve games of bowling

Question 74

As long as scarcity exists,_____

A)product prices play no role in consumers' utility maximization.
B)income plays no role in consumers' utility maximization.
C)income and product prices should both be considered for consumers' utility maximization.
D)consumers maximize utility by consuming all products until the marginal utilities of additional amounts are zero.
E)consumers would increase the consumption of all products as long as total utility is positive.

Question 75

Which of the following is true when the price of a good is zero?

A)A consumer will consume additional units of the good as long as the ratio of total utility to price is positive.
B)A consumer will consume an infinite quantity of the good as the good is available free of cost.
C)A consumer will consume additional units of the good as long as marginal utility is positive.
D)A consumer will consume the entire amount of the good available in the market.
E)A consumer will consume until total utility derived from consumption becomes zero.

Question 76

Annie reallocates her budget until the ratios of marginal utilities of goods equal the ratios of their prices.Which of the following is true of Annie's behavior?

A)She ensures that her expected marginal utilities from goods are equal to zero.
B)She ensures that her marginal utility from each good is less than that good's marginal cost.
C)She maximizes her total utility derived from the consumption of goods.
D)She adjusts her baskets of goods until marginal utilities of all goods become negative.
E)She maximizes her marginal utilities from goods and minimizes her disutility from consumption.

Question 77

Exhibit 6.2

Refer to Exhibit 6.2,which shows the marginal and total utility derived by a consumer from watching an additional baseball game every month.Which of the following is true of total utility derived from watching the baseball games?

A)After the sixth game, total utility decreases and marginal utility is positive.
B)After the sixth game, total utility decreases as marginal utility is negative.
C)After the sixth game, total utility increases and marginal utility is positive.
D)After the sixth game, total utility increases as marginal utility is negative.
E)After the sixth game, total utility decreases as marginal utility is constant.

Question 78

If a good is offered free of charge,one would _____

A)never stop consuming it.
B)stop consuming it when its marginal utility begins to fall.
C)stop consuming it when its marginal utility begins to increase.
D)stop consuming it when its marginal utility has declined to zero.
E)never consume it because it has no market value.

Question 79

Suppose Annie allocates her income between calzones and juices and that she has not yet spent her entire income.If the marginal utility of a fourth calzone is 100 units and the marginal utility of a third glass of juice is 50 units,she will _____

A)eat the fourth calzone, as one unit of a calzone has a higher marginal utility than a glass of juice.
B)drink the third glass of juice, because she had only two glasses of juice.
C)consider the total utility derived from the consumption of three calzones and two glasses of juice before deciding what to consume next.
D)consider the relative prices of calzones and juices before deciding what to consume next.
E)consider whether her marginal utilities are diminishing or not before deciding what to consume next.

Question 80

Suppose Jason's marginal utility of $50-per-serving caviar is 100 units and that of $1-per-serving popcorn is 10 units.Which of the following combinations of snacks would he prefer to buy?

A)If he has $49, then he will buy one serving of caviar and zero servings of popcorn.
B)If he has $53, he will buy one serving of caviar and two servings of popcorn.
C)Irrespective of the amount of money he has, he will always buy popcorn.
D)If he has $50, then he will buy one serving each of caviar and popcorn.
E)Irrespective of the amount of money he has, he will always buy caviar.