Question 1

Claire has just eaten her second bowl of cereal.We can say:

Accepted Answer

A)  her second bowl likely reduced her total utility.
B)  her second bowl likely added less to her total utility than the first.
C)  her third bowl will likely decrease her total utility.
D)  her third bowl will likely increase her total utility by at least as much as the second.E) All of the above
F) B) and D)

Question 2

Utility is:

Accepted Answer

A)  maximized by rational individuals.
B)  revealed by observing choices an individual makes.
C)  the value individuals place on different bundles of goods.
D)  All of these are true.E) B) and D)
F) B) and C)

Question 3

This table shows the different combinations of goods that Jack can consume,given that his income to spend on these two items is $10. 
Considering the information in the table shown,if Jack's income to spend on these two items were to increase to $16:

Accepted Answer

A)  he could afford to buy 16 popsicles and 8 ice cream cones.
B)  he could afford to buy either 16 popsicles or 8 ice cream cones.
C)  he could afford to buy 4 ice cream cones and 8 popsicles.
D)  None of these is true.E) A) and C)
F) All of the above

Question 4

You decide to forgo a third slice of pizza and have a scoop of ice cream instead.This is an example of the economic concept of:

Accepted Answer

A)  diminishing marginal utility.
B)  altruism.
C)  reciprocity.
D)  selfishness.E) None of the above
F) B) and D)

Question 5

Barbie is deciding whether to play soccer or go swimming over the next hour.She decides to swim.Economists would conclude that Barbie:

Accepted Answer

A)  is revealing a preference for swimming over soccer.
B)  will get more utility from swimming during the next hour than playing soccer.
C)  will always choose swimming over soccer,ceteris paribus.
D)  All of these are true.E) B) and D)
F) All of the above

Question 6

Courtney goes for an hour bike ride and gains utility of 8.She stops and gets an ice cream cone,then rides for another hour.Using the concept of utility to explain her choice,we can say:

Accepted Answer

A)  the utility gained from the ice cream was at least 8.
B)  the utility gained from the ice cream was more than 8.
C)  the utility gained from the ice cream was less than the second hour of bike riding.
D)  the utility gained from the ice cream was more than the second hour of bike riding.E) A) and D)
F) None of the above

Question 7

Utility measurements are:

Accepted Answer

A)  a relative ranking of the values a person places on alternative combinations of things.
B)  a relative ranking of how much people enjoy a particular good.
C)  used to compare one person's preference for a good to another person's preference.
D)  None of these is true.E) A) and D)
F) B) and C)

Question 8

If successive units of a good are consumed,the marginal utility gained typically:

Accepted Answer

A)  increases at the same rate for all people.
B)  increases at different rates for different people.
C)  decreases at the same rate for all people.
D)  decreases at different rates for different people.E) A) and B)
F) None of the above

Question 9

The concept of utility:

Accepted Answer

A)  cannot be used to explain why people are charitable.
B)  cannot be used to explain why people are altruistic.
C)  cannot be used to explain why people are selfish.
D)  None of these is true.E) C) and D)
F) None of the above

Question 10

Sadie has just eaten a donut and received a utility of 6.If she chooses to eat another donut:

Accepted Answer

A)  we can assume she will get at least a utility of 6.
B)  we can assume she will get a utility of 6.
C)  we can assume she will get less than a utility of 6.
D)  we can assume Sadie's total utility will fall because of diminishing marginal utility.E) None of the above
F) B) and C)

Question 11

Seth is a surgeon who goes to Cambodia each summer and donates two weeks of his time to local hospitals.From an economic standpoint,utility is gained by:

Accepted Answer

A)  Seth's patients.
B)  Seth,knowing he is doing a good deed.
C)  Seth,knowing the local paper writes a story about his trip every time he comes home.
D)  All of these are true.E) A) and B)
F) A) and C)

Question 12

Thinking about the total utility gained from the consumption of a typical good,we can say,in general,for normal goods:

Accepted Answer

A)  total utility will rise,peak,and then decline as more and more units are consumed.
B)  consuming more and more units of a good will eventually cause total utility to fall.
C)  total utility increases by decreasing amounts,until it is maximized.Then it declines.
D)  All of these are true.E) B) and C)
F) A) and B)

Question 13

Sam has $200 a month to spend on two normal goods-tanning sessions or rounds of golf.Tanning sessions are $20 each,and a round of golf is $40.Sam currently consumes six tanning sessions and two rounds of golf.If the price of a round of golf drops to $20,the income effect:

Accepted Answer

A)  predicts Sam will increase his consumption of both golf and tanning sessions.
B)  predicts Sam will double his consumption of golf.
C)  predicts Sam will consume more golf and less tanning sessions.
D)  predicts Sam will consume less golf and more tanning sessions.E) A) and B)
F) A) and C)

Question 14

Utility is:

Accepted Answer

A)  useful in describing a person's preferences for one good over another.
B)  useful in comparing different people's preferences for a particular good.
C)  useful in predicting when to put an item on sale.
D)  an interesting concept,but not really useful for anything.E) All of the above
F) C) and D)

Question 15

Sam has $200 a month to spend on either tanning sessions or rounds of golf.Tanning sessions are $20 each,and a round of golf is $40.What can we say about Sam's utility?

Accepted Answer

A)  Sam will get more utility from each round of golf than each tanning session.
B)  Sam will get the same utility from one round of golf as he would from two tanning sessions.
C)  Sam will maximize his utility from 2 rounds of golf and 6 tanning sessions.
D)  We cannot say anything about Sam's utility from the consumption of these goods without more information.E) C) and D)
F) B) and D)

Question 16

Which of the following statements is true about individuals and utility?

Accepted Answer

A)  Individuals always seek to maximize utility.
B)  Individuals always seek to maximize their income,not utility.
C)  Individuals will either minimize or maximize utility depending on the situation.
D)  Individuals rarely try to maximize their utility.E) None of the above
F) B) and D)

Question 17

Dave and Buster play two games of tennis,then decide to go have lunch.Using the concept of utility to explain their choices,we can conclude that:

Accepted Answer

A)  they each won one game of tennis.
B)  the marginal utility from playing a third game must be negative for them.
C)  the marginal utility from playing a third game must be less than the utility from having lunch.
D)  All of these must be true.E) None of the above
F) B) and C)

Question 18

Nona has just gone on a bike ride for an hour and received a utility of 7.If she chooses to continue to ride her bike for another hour:

Accepted Answer

A)  we can assume she will get at least a utility of 7.
B)  we can assume she will get a utility of 7.
C)  we can assume she will get less than a utility of 7.
D)  we can assume Nona's total utility will fall because of diminishing marginal utility.E) A) and B)
F) B) and C)

Question 19

This graph shows three different budget constraints: A,B,andC.

If Bart has budget constraint A in the graph shown,what would cause his budget constraint to shift to B?

Accepted Answer

A)  Bart's income has decreased.
B)  The price of soda has increased.
C)  The price of soda has decreased.
D)  The price of milk has increased.E) A) and B)
F) A) and C)

Question 20

Carrie is deciding between wearing her blue sweater or her denim jacket.If she chooses her sweater,we can conclude:

Accepted Answer

A)  Carrie will gain more utility from wearing the sweater than the jacket right now.
B)  Carrie will never choose the jacket as long as she owns the sweater.
C)  Carrie is irrational if she chooses the jacket over the sweater.
D)  We cannot conclude any of these things.E) None of the above
F) A) and B)

Exam 7: Consumer Behavior

Carrie is deciding between wearing her blue sweater or her denim jacket.If she chooses her sweater,we can conclude:

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Which of the following statements is true about individuals and utility?

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The concept of utility:

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Seth is a surgeon who goes to Cambodia each summer and donates two weeks of his time to local hospitals.From an economic standpoint,utility is gained by:

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Claire has just eaten her second bowl of cereal.We can say:

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Sam has $200 a month to spend on two normal goods-tanning sessions or rounds of golf.Tanning sessions are $20 each,and a round of golf is $40.Sam currently consumes six tanning sessions and two rounds of golf.If the price of a round of golf drops to $20,the income effect:

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Sadie has just eaten a donut and received a utility of 6.If she chooses to eat another donut:

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Thinking about the total utility gained from the consumption of a typical good,we can say,in general,for normal goods:

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Nona has just gone on a bike ride for an hour and received a utility of 7.If she chooses to continue to ride her bike for another hour:

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If successive units of a good are consumed,the marginal utility gained typically:

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Dave and Buster play two games of tennis,then decide to go have lunch.Using the concept of utility to explain their choices,we can conclude that:

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Sam has $200 a month to spend on either tanning sessions or rounds of golf.Tanning sessions are $20 each,and a round of golf is $40.What can we say about Sam's utility?

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Utility measurements are:

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Courtney goes for an hour bike ride and gains utility of 8.She stops and gets an ice cream cone,then rides for another hour.Using the concept of utility to explain her choice,we can say:

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Barbie is deciding whether to play soccer or go swimming over the next hour.She decides to swim.Economists would conclude that Barbie:

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Utility is:

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This graph shows three different budget constraints: A,B,andC. If Bart has budget constraint A in the graph shown,what would cause his budget constraint to shift to B?

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You decide to forgo a third slice of pizza and have a scoop of ice cream instead.This is an example of the economic concept of:

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This table shows the different combinations of goods that Jack can consume,given that his income to spend on these two items is $10. Considering the information in the table shown,if Jack's income to spend on these two items were to increase to $16:

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Utility is:

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