Question 1

Table: Demand and Utility Schedules for packs of scented candles $$\begin{array} { | c | c | c | c | } 
\hline \text { Price } & \text { Quantity Demanded } & \text { Marginal Utility } & \text { Total Utility } \
\hline \$ 8 & 1 & & \
\hline \$ 7 & 2 & & \
\hline \$ 6 & 3 & & \
\hline \$ 5 & 4 & & \
\hline \$ 4 & 5 & & \
\hline
\end{array}$$
-The additional utility from her purchase of a third scented candle would be

Accepted Answer

A) $4. 
B) $5. 
C) $6. 
D) $15. 
E) $21.

Question 2

Kelly eats five slices of pizza on a Friday night but admits each slice of pizza doesn't taste as good as the previous one.This suggests that for Kelly

Accepted Answer

A) the marginal utility of a slice of pizza is negative. 
B) the total utility of slices of pizza is increasing by larger and larger increments. 
C) the total utility of slices of pizza is declining. 
D) the marginal utility of a slice of pizza is positive but decreasing.

Question 3

Mr.Fefferberg had determined that the marginal utility of the last dollar he spent on cowboy boots is greater than the marginal utility of the last dollar that he spent on Nikes.Since he is a rational fellow,he will

Accepted Answer

A) buy equal quantities of Nikes and cowboy boots. 
B) buy more cowboy boots and fewer Nikes. 
C) buy more Nikes and fewer cowboy boots. 
D) give up cowboy boots entirely. 
E) give up Nikes entirely.

Question 4

Statement I: Consumer surplus is the difference between what you have to pay and what you would have been willing to pay.
Statement II: A person's total utility reaches a maximum when that person's marginal utility falls to zero.

Accepted Answer

A) Statement I is true and statement II is false. 
B) Statement II is true and statement I is false. 
C) Both statements are true. 
D) Both statements are false.

Question 5

If you pay a very high price for a good or service,you _____ (are/are not)getting ripped off.

Accepted Answer

The answer of If you pay a very high price...

Question 6

If marginal utility is declining but still greater than zero,then total utility is

Accepted Answer

A) unrelated to the changes in marginal utility. 
B) declining as well. 
C) increasing. 
D) declining for a while but increasing as it approaches zero. 
E) staying the same.

Question 7

Statement I: The water-diamond paradox can be resolved using utility theory.
Statement II: If the price of water was high and the price of diamonds was low,there would be no water-diamond paradox.

Accepted Answer

A) Statement I is true and statement II is false. 
B) Statement II is true and statement I is false. 
C) Both statements are true. 
D) Both statements are false.

Question 8

Table-Demand and Utility Table for action figures $$\begin{array} { | c | c | c | c | } 
\hline \text { Price } & \text { Quantity Demanded } & \text { Marginal Utility } & \text { Total Utility } \
\hline \$ 14 & 1 & & \
\hline \$ 12 & 2 & & \
\hline \$ 10 & 3 & & \
\hline \$ 8 & 4 & & \
\hline \$ 6 & 5 & & \
\hline
\end{array}$$
-If the price of action figures was $10 each,his total utility would be ____ and your marginal utility would be ___.

Accepted Answer

A) $30 and $10 
B) $36 and $12 
C) $36 and $10 
D) $26 and $12 
E) $50 and $6

Question 9

Demand and Utility Table for Milk Shakes $$\begin{array} { | c | c | c | c | } 
\hline \text { Price } & \text { Quantity Demanded } & \text { Marginal Utility } & \text { Total Utility } \
\hline \$ 4 & 1 & & \
\hline \$ 3.50 & 2 & & \
\hline \$ 3.00 & 3 & & \
\hline \$ 2.50 & 4 & & \
\hline \$ 2.00 & 5 & & \
\hline
\end{array}$$
-If the price of milk shakes was $3.00 each,your consumer surplus would be

Accepted Answer

A) $10.50. 
B) $6.00. 
C) $3.50. 
D) $3.00. 
E) $1.50.

Question 10

Demand and Utility Table for Milk Shakes $$\begin{array} { | c | c | c | c | } 
\hline \text { Price } & \text { Quantity Demanded } & \text { Marginal Utility } & \text { Total Utility } \
\hline \$ 4 & 1 & & \
\hline \$ 3.50 & 2 & & \
\hline \$ 3.00 & 3 & & \
\hline \$ 2.50 & 4 & & \
\hline \$ 2.00 & 5 & & \
\hline
\end{array}$$
-The marginal utility of your fourth milk shake would be

Accepted Answer

A) $13. 
B) $2.50. 
C) $2.00. 
D) $.50.

Question 11

Table-Demand and Utility Table for action figures $$\begin{array} { | c | c | c | c | } 
\hline \text { Price } & \text { Quantity Demanded } & \text { Marginal Utility } & \text { Total Utility } \
\hline \$ 14 & 1 & & \
\hline \$ 12 & 2 & & \
\hline \$ 10 & 3 & & \
\hline \$ 8 & 4 & & \
\hline \$ 6 & 5 & & \
\hline
\end{array}$$
-Tommy's total utility for 5 action figures would be

Accepted Answer

A) $6. 
B) $14. 
C) $30. 
D) $36. 
E) $50.

Question 12

Table: Demand and Utility Schedules for packs of scented candles $$\begin{array} { | c | c | c | c | } 
\hline \text { Price } & \text { Quantity Demanded } & \text { Marginal Utility } & \text { Total Utility } \
\hline \$ 8 & 1 & & \
\hline \$ 7 & 2 & & \
\hline \$ 6 & 3 & & \
\hline \$ 5 & 4 & & \
\hline \$ 4 & 5 & & \
\hline
\end{array}$$
-Her marginal utility of her fifth scented candle would be

Accepted Answer

A) $4. 
B) $5. 
C) $20. 
D) $26. 
E) $30.

Question 13

The Adonis Tanning Salon is running a special this month of $1 a session.Lothario Goodman goes there 15 times,instead of his customary 5.

Accepted Answer

A) His consumer surplus is larger. 
B) His consumer surplus is smaller. 
C) His consumer surplus is the same. 
D) It cannot be determined if his consumer surplus is larger,smaller,or the same.

Question 14

A person's utility schedule ____________ (can/cannot)change over time.

Accepted Answer

The answer of A person's utility schedule ____________ (can/cannot)change over...

Question 15

Statement I: If a poor person found a ten-dollar bill lying on the sidewalk,he would get more utility from what he could buy with it than a rich person.
Statement II: There is no answer to the question: "What is the utility of the economics course you're taking?"

Accepted Answer

A) Statement I is true and statement II is false. 
B) Statement II is true and statement I is false. 
C) Both statements are true. 
D) Both statements are false.

Question 16

If the marginal utility you derived from the first "steak burger" you ate was $4.00 and yet the cost of the "steak burger" was $2.00.Your marginal utility was definitely

Accepted Answer

A) positive. 
B) zero. 
C) negative. 
D) less than a second steak burger you plan to eat.

Question 17

Statement I: A person's marginal utility schedule can be derived from her demand schedule.
Statement II: If you purchased six dance lessons,the total utility you derived from the six lessons would be greater than the total utility you would have derived from five lessons.

Accepted Answer

A) Statement I is true and statement II is false. 
B) Statement II is true and statement I is false. 
C) Both statements are true. 
D) Both statements are false.

Question 18

The additional utility derived from consuming one more unit of some good or service is called ___________.

Accepted Answer

The answer of The additional utility derived from consuming one...

Question 19

Statement I: If you knew a person's demand schedule,you could figure out her marginal utility schedule.
Statement II: As a person consumes more and more of a service,her total utility rises and her marginal utility declines.

Accepted Answer

A) Statement I is true and statement II is false. 
B) Statement II is true and statement I is false. 
C) Both statements are true. 
D) Both statements are false.

Question 20

-Given the demand curve in this graph,if price were $2.00,how much quantity would be purchased?

Accepted Answer

A) 1 unit 
B) 2 units 
C) 3 units 
D) 4 units

Exam 19: Theory of Consumer Behavior

Kelly eats five slices of pizza on a Friday night but admits each slice of pizza doesn't taste as good as the previous one.This suggests that for Kelly

Mr.Fefferberg had determined that the marginal utility of the last dollar he spent on cowboy boots is greater than the marginal utility of the last dollar that he spent on Nikes.Since he is a rational fellow,he will

Statement I: Consumer surplus is the difference between what you have to pay and what you would have been willing to pay. Statement II: A person's total utility reaches a maximum when that person's marginal utility falls to zero.

If you pay a very high price for a good or service,you _____ (are/are not)getting ripped off.

If marginal utility is declining but still greater than zero,then total utility is

Statement I: The water-diamond paradox can be resolved using utility theory. Statement II: If the price of water was high and the price of diamonds was low,there would be no water-diamond paradox.

The Adonis Tanning Salon is running a special this month of $1 a session.Lothario Goodman goes there 15 times,instead of his customary 5.

A person's utility schedule ____________ (can/cannot)change over time.

Statement I: If a poor person found a ten-dollar bill lying on the sidewalk,he would get more utility from what he could buy with it than a rich person. Statement II: There is no answer to the question: "What is the utility of the economics course you're taking?"

If the marginal utility you derived from the first "steak burger" you ate was $4.00 and yet the cost of the "steak burger" was $2.00.Your marginal utility was definitely

Statement I: A person's marginal utility schedule can be derived from her demand schedule. Statement II: If you purchased six dance lessons,the total utility you derived from the six lessons would be greater than the total utility you would have derived from five lessons.

The additional utility derived from consuming one more unit of some good or service is called ___________.

Statement I: If you knew a person's demand schedule,you could figure out her marginal utility schedule. Statement II: As a person consumes more and more of a service,her total utility rises and her marginal utility declines.

-Given the demand curve in this graph,if price were $2.00,how much quantity would be purchased?