Deck 14: B: Consumers Surplus

Question 1

If Bernice (whose utility function is min{x,y},where x is her consumption of earrings and y is money left for other stuff)had an income of $16 and was paying a price of $8 for earrings when the price of earrings went up to $10,then the equivalent variation of the price change was

A) $3.56.
B) $1.45.
C) $2.91.
D) $7.11.
E) $3.23.

Answer 1

$2.91.

Question 2

If Bernice (whose utility function is min{x,y},where x is her consumption of earrings and y is money left for other stuff)had an income of $10 and was paying a price of $3 for earrings when the price of earrings went up to $4,then the equivalent variation of the price change was

A) $2.
B) $2.50.
C) $5.
D) $1.
E) $2.25.

Answer 2

$2.

Question 3

Ms.Quasimodo in Problem 3 has the utility function U(x,m)=100x -x²/2+ m,where x is her consumption of earplugs and m is money left over to spend on other stuff.If she has $10,000 to spend on earplugs and other stuff and if the price of earplugs rises from $50 to $70,then her net consumer's surplus

A) increases by 400.
B) falls by 2,800.
C) falls by 600.
D) falls by 800.
E) increases by 1,600.

Answer 3

falls by 800.

Question 4

Ms.Quasimodo in Problem 3 has the utility function U(x,m)= 100x - x²/2 + m,where x is her consumption of earplugs and m is money left over to spend on other stuff.If she has $10,000 to spend on earplugs and other stuff and if the price of earplugs rises from $50 to $65,then her net consumer's surplus

A) falls by 2,637.50.
B) falls by 525.
C) falls by 637.50.
D) increases by 318.75.
E) increases by 1,275.

Question 5

Ms.Quasimodo in Problem 3 has the utility function U(x,m)= 100x- x²/2+ m,where x is her consumption of earplugs and m is money left over to spend on other stuff.If she has $10,000 to spend on earplugs and other stuff and if the price of earplugs rises from $50 to $85,then her net consumer's surplus

A) falls by 1,137.50.
B) falls by 3,137.50.
C) falls by 525.
D) increases by 568.75.
E) increases by 2,275.

Question 6

In Problem 1,Sir Plus has a demand function for mead that is given by the equation D(p)= 100 - p.If the price of mead is $85,how much is Sir Plus's net consumer's surplus?

A) 15
B) 112.50
C) 56.25
D) 225
E) 7,650

Question 7

In Problem 1,Sir Plus has a demand function for mead that is given by the equation D(p)=100- p.If the price of mead is $95,how much is Sir Plus's net consumer's surplus?

A) 25
B) 6.25
C) 5
D) 12.50
E) 9,500

Question 8

Bernice in Problem 5 has the utility function u(x,y)=minF{x,y},where x is the number of pairs of earrings she buys per week and y is the number of dollars per week she has left to spend on other things.(We allow the possibility that she buys fractional numbers of pairs of earrings per week. )If she originally had an income of $18 per week and was paying a price of $8 per pair of earrings,then if the price of earrings rose to $14,the compensating variation of that price change (measured in dollars per week)would be closest to

A) $12.
B) $25.
C) $7.20.
D) $24.
E) $23.

Question 9

Bernice in Problem 5 has the utility function u(x,y)=min{x,y},where x is the number of pairs of earrings she buys per week and y is the number of dollars per week she has left to spend on other things.(We allow the possibility that she buys fractional numbers of pairs of earrings per week. )If she originally had an income of $19 per week and was paying a price of $8 per pair of earrings,then if the price of earrings rose to $10,the compensating variation of that price change (measured in dollars per week)would be closest to

A) $4.22.
B) $9.44.
C) $3.45.
D) $8.44.
E) $7.44.

Question 10

If Bernice (whose utility function is minF{x,y},where x is her consumption of earrings and y is money left for other stuff)had an income of $13 and was paying a price of $2 for earrings when the price of earrings went up to $3,then the equivalent variation of the price change was

A) $3.25.
B) $4.33.
C) $8.67.
D) $1.63.
E) $3.79.

Question 11

If Bernice (whose utility function is min{x,y},where x is her consumption of earrings and y is money left for other stuff)had an income of $20 and was paying a price of $1 for earrings when the price of earrings went up to $6,then the equivalent variation of the price change was

A) $50.
B) $14.29.
C) $7.14.
D) $100.
E) $32.14.

Question 12

In Problem 1,Sir Plus has a demand function for mead that is given by the equation D(p)=100- p.If the price of mead is $95,how much is Sir Plus's net consumer's surplus?

A) 12.50
B) 6.25
C) 25
D) 5
E) 9,500

Question 13

Bernice in Problem 5 has the utility function u(x,y)=min{x,y},where x is the number of pairs of earrings she buys per week and y is the number of dollars per week she has left to spend on other things.(We allow the possibility that she buys fractional numbers of pairs of earrings per week. )If she originally had an income of $20 per week and was paying a price of $2 per pair of earrings,then if the price of earrings rose to $5,the compensating variation of that price change (measured in dollars per week)would be closest to

A) $20.
B) $41.
C) $40.
D) $10.
E) $39.

Question 14

In Problem 1,Sir Plus has a demand function for mead that is given by the equation D(p)=100 - p.If the price of mead is $85,how much is Sir Plus's net consumer's surplus?

A) 15
B) 225
C) 56.25
D) 112.50
E) 7,650

Question 15

Ms.Quasimodo in Problem 3 has the utility function U(x,m)= 100x -x²/2+m,where x is her consumption of earplugs and m is money left over to spend on other stuff.If she has $10,000 to spend on earplugs and other stuff and if the price of earplugs rises from $50 to $75,then her net consumer's surplus

A) falls by 937.50.
B) falls by 625.
C) falls by 2,937.50.
D) increases by 468.75.
E) increases by 1,875.

Question 16

Ms.Quasimodo in Problem 3 has the utility function U(x,m)= 100x -x²/2+ m,where x is her consumption of earplugs and m is money left over to spend on other stuff.If she has $10,000 to spend on earplugs and other stuff and if the price of earplugs rises from $50 to $70,then her net consumer's surplus

A) falls by 800.
B) increases by 400.
C) falls by 600.
D) falls by 2,800.
E) increases by 1,600.

Question 17

Bernice in Problem 5 has the utility function u(x,y)=min {x,y},where x is the number of pairs of earrings she buys per week and y is the number of dollars per week she has left to spend on other things.(We allow the possibility that she buys fractional numbers of pairs of earrings per week. )If she originally had an income of $17 per week and was paying a price of $3 per pair of earrings,then if the price of earrings rose to $7,the compensating variation of that price change (measured in dollars per week)would be closest to

A) $8.50.
B) $17.
C) $35.
D) $34.
E) $33.

Question 18

In Problem 1,Sir Plus has a demand function for mead that is given by the equation D(p)= 100 -p.If the price of mead is $85,how much is Sir Plus's net consumer's surplus?

A) 112.50
B) 15
C) 225
D) 56.25
E) 7,650

Question 19

If Bernice (whose utility function is min{x,y},where x is her consumption of earrings and y is money left for other stuff)had an income of $19 and was paying a price of $5 for earrings when the price of earrings went up to $11,then the equivalent variation of the price change was

A) $19.
B) $38.
C) $9.50.
D) $4.75.
E) $14.25.

Question 20

Bernice in Problem 5 has the utility function u(x,y)=min{x,y},where x is the number of pairs of earrings she buys per week and y is the number of dollars per week she has left to spend on other things.(We allow the possibility that she buys fractional numbers of pairs of earrings per week. )If she originally had an income of $11 per week and was paying a price of $4 per pair of earrings,then if the price of earrings rose to $8,the compensating variation of that price change (measured in dollars per week)would be closest to

A) $4.89.
B) $17.60.
C) $18.60.
D) $8.80.
E) $16.60.

Question 21

Betsy's utility function for BMWs and money is given by 8,000x + y,where x is the number of BMWs she has and y is the amount of money she has.Her income is $22,000.Her reservation price for one BMW is

A) $14,000.
B) $8,000 - y.
C) $8,000 - p.
D) $8,000.
E) $30,000.

Question 22

In Problem 7,Lolita's utility function is U(x,y)=x - x²/2+ y,where x is her consumption of cow feed and y is her consumption of hay.If the price of cow feed is $.60,the price of hay is $1,and her income is $4 and if Lolita chooses the combination of hay and cow feed that she likes best from among those combinations she can afford,her utility will be

A) 4.08.
B) 3.40.
C) 0.08.
D) 6.08.
E) 2.08.

Question 23

In Problem 7,Lolita's utility function is U(x,y)= x { x²/2 }y,where x is her consumption of cow feed and y is her consumption of hay.If the price of cow feed is $.30,the price of hay is $1,and her income is $2 and if Lolita chooses the combination of hay and cow feed that she likes best from among those combinations she can afford,her utility will be

A) 2.24.
B) 1.70.
C) 0.24.
D) 3.24.
E) 1.24.

Question 24

Cindy's utility function for BMWs and money is given by 19,000x + y,where x is the number of BMWs she has and y is the amount of money she has.Her income is $24,000.Her reservation price for one BMW is

A) $19,000.
B) $19,000 - y.
C) $5,000.
D) $19,000 - p.
E) $43,000.

Question 25

Betsy's utility function for BMWs and money is given by 24,000x + y,where x is the number of BMWs she has and y is the amount of money she has.Her income is $32,000.Her reservation price for one BMW is

A) $24,000.
B) $24,000 - p.
C) $24,000- y.
D) $8,000.
E) $56,000.

Question 26

In Problem 7,Lolita's utility function is U(x,y)= x - x²/2 + y,where x is her consumption of cow feed and y is her consumption of hay.If the price of cow feed is $.10,the price of hay is $1,and her income is $2 and if Lolita chooses the combination of hay and cow feed that she likes best from among those combinations she can afford,her utility will be

A) 0.40.
B) 3.40.
C) 2.40.
D) 1.90.
E) 1.40.

Question 27

Desiree's utility function for BMWs and money is given by 9,000x + y,where x is the number of BMWs she has and y is the amount of money she has.Her income is $22,000.Her reservation price for one BMW is

A) $9,000 - p.
B) $9,000.
C) $13,000.
D) $9,000 - y.
E) $31,000.

Question 28

Kitty's utility function for BMWs and money is given by 16,000x + y,where x is the number of BMWs she has and y is the amount of money she has.Her income is $23,000.Her reservation price for one BMW is

A) $16,000 - y.
B) $16,000 - p.
C) $16,000.
D) $7,000.
E) $39,000.

Question 29

In Problem 7,Lolita's utility function is U(x,y)= x -x²/2 + y,where x is her consumption of cow feed and y is her consumption of hay.If the price of cow feed is $.10,the price of hay is $1,and her income is $2 and if Lolita chooses the combination of hay and cow feed that she likes best from among those combinations she can afford,her utility will be

A) 0.40.
B) 3.40.
C) 1.90.
D) 2.40.
E) 1.40.

Question 30

In Problem 7,Lolita's utility function is U(x,y)= x -x²/2 + y,where x is her consumption of cow feed and y is her consumption of hay.If the price of cow feed is $.10,the price of hay is $1,and her income is $2 and if Lolita chooses the combination of hay and cow feed that she likes best from among those combinations she can afford,her utility will be

A) 2.40.
B) 3.40.
C) 0.40.
D) 1.90.
E) 1.40.