Question 1

Recall the Application about the appropriate amount for a cigarette tax to answer the following question(s).
-Recall the Application.According to the study,how would the cigarette tax effect low-income households?

Accepted Answer

A)  It will be beneficial as low-income households will respond to changes in the higher price of cigarettes. 
B)  Low-income households would experience a relatively large increase in life span. 
C)  Low-income households will not benefit from the cigarette tax. 
D)  Both A and B are correct.

Question 2

With respect to the equimarginal rule,a person will maximize utility when the

Accepted Answer

A)  total utility per dollar spent is equalized across products. 
B)  marginal utility is equalized across products. 
C)  total utility is equalized across products. 
D)  marginal utility per dollar spent is equalized across products.

Question 3

An individual demand curve shows the relationship between the price of a product and the quantity demanded by a rational consumer.

Accepted Answer

A) True 
 B)False

Question 4

Present bias occurs because there is a match in the timing of benefits and costs.

Accepted Answer

A) True 
 B)False

Question 5

Table 7.1
-Refer to Table 7.1.The total utility of five donuts per day is

Accepted Answer

A)  60. 
B)  65. 
C)  70. 
D)  78.

Question 6

Neuron activity in the insula represents the benefit of buying a product.

Accepted Answer

A) True 
 B)False

Question 7

At her current consumption level,Betty gets twice as much marginal utility from an additional bottle of soda as she does from an additional bottle of water.If she is maximizing her utility and the price of soda is $2 per bottle,then the price of a bottle of water must be

Accepted Answer

A)  $1.00. 
B)  $2.00. 
C)  $4.00. 
D)  $8.00.

Question 8

What of the following is another mental shortcut to monitor consumption?

Accepted Answer

A)  bundles 
B)  utilities 
C)  accounts 
D)  none of the above

Question 9

Marginal utility is the

Accepted Answer

A)  total amount of satisfaction gained by the consumption of a good or service. 
B)  additional satisfaction gained by the consumption or use of one more unit of something. 
C)  price of a good relative to the prices of other goods and services. 
D)  comparison of utility between two different people.

Question 10

What does diminishing marginal utility imply about the shape of a person's demand curve? Explain.

Accepted Answer

The answer of What does diminishing marginal utility imply about...

Question 11

Table 7.6
-Refer to Table 7.6.Pete has $10 to spend.He buys four cookies and three candies.Using the equimarginal rule,which of the following is true?

Accepted Answer

A)  Pete is maximizing his utility. 
B)  Pete is not spending the entire $10. 
C)  Pete could make himself better off by buying less candy and more cookies. 
D)  Pete could make himself better off by buying less cookies and more candy.

Question 12

the key regions for cost valuation are the insular cortex (insula for short)and the amygdala.

Accepted Answer

A) True 
 B)False

Question 13

Table 7.1
-Refer to Table 7.1.The marginal utility of the third cup of coffee per day is

Accepted Answer

A)  15. 
B)  20. 
C)  25. 
D)  35.

Question 14

Table 7.3
-Refer to Table 7.3.The marginal utility of the first book is

Accepted Answer

A)  1.1. 
B)  20. 
C)  21. 
D)  22.

Exam 7: Consumer Choice: Utility Theory and Insights From Neuroscience

Recall the Application about the appropriate amount for a cigarette tax to answer the following question(s) . -Recall the Application.According to the study,how would the cigarette tax effect low-income households?

With respect to the equimarginal rule,a person will maximize utility when the

An individual demand curve shows the relationship between the price of a product and the quantity demanded by a rational consumer.

Present bias occurs because there is a match in the timing of benefits and costs.

Table 7.1 -Refer to Table 7.1.The total utility of five donuts per day is

Neuron activity in the insula represents the benefit of buying a product.

At her current consumption level,Betty gets twice as much marginal utility from an additional bottle of soda as she does from an additional bottle of water.If she is maximizing her utility and the price of soda is $2 per bottle,then the price of a bottle of water must be

What of the following is another mental shortcut to monitor consumption?

Marginal utility is the

What does diminishing marginal utility imply about the shape of a person's demand curve? Explain.

Table 7.6 -Refer to Table 7.6.Pete has $10 to spend.He buys four cookies and three candies.Using the equimarginal rule,which of the following is true?

the key regions for cost valuation are the insular cortex (insula for short)and the amygdala.

Table 7.1 -Refer to Table 7.1.The marginal utility of the third cup of coffee per day is

Table 7.3 -Refer to Table 7.3.The marginal utility of the first book is