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Utility and Demand III

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  • As long as the marginal utility per dollar from pizza is greater than the marginal utility per dollar from soda, then to maximize utility a consumer will buy
    more soda to equalize the marginal utility per dollar.
    equal amounts of pizza and soda.
    less pizza and less soda.
    more pizza and less soda.
  • As you consume additional hamburgers, the relationship between total and marginal utility is that
    total utility decreases, but marginal utility increases.
    both total and marginal utility increase continuously.
    both total and marginal utility decrease continuously.
    total utility increases, but marginal utility decreases.
  • Total utility is maximized when the ___ for all goods.
    marginal utilities are zero
    marginal utilities are maximized
    marginal utilities are negative
    marginal utility per dollar spent is equal
  • Mark's marginal utility from reading books is the ___when he reads ___.
    consumer surplus he gets; books
    change in his total utility; more books
    total utility he gets; one more book
    change in his total utility; one additional book
  • The measure of the benefit you get from consuming the next cup of coffee is your
    total utility from coffee when you are at your consumer equilibrium.
    total utility from coffee.
    marginal utility of coffee.
    total utility per dollar spent on coffee.
  • Marginal utility measures the
    total utility from consumption.
    average utility from an additional unit of consumption.
    additional utility from an additional unit of consumption.
    additional cost of an additional unit of consumption.
  • A consumer has maximized his or her utility by consuming
    so that the ratio of marginal utility to price is the same for all goods.
    so that the total utility of all goods consumed is the same.
    at the midpoint of the budget constraint line.
    at the midpoint of the demand curve.
  • Total utility is maximized when a consumer has spent all of his or her income and
    spent equal amounts on all goods.
    the total utility per dollar from all goods is equal.
    marginal utility is maximized.
    the marginal utility per dollar from all goods is equal.
  • The marginal utility from the consumption of a good is equal to the
    total utility divided by the price.
    total utility divided by the quantity consumed.
    change in total utility divided by the change in the quantity consumed.
    change in total utility divided by the change in price.
  • The principle of diminishing marginal utility can be used to explain why
    Bob enjoys his first soda more than Charlie enjoys his fourth.
    Bob's first soda is less enjoyable than his second soda.
    Charlie enjoys his fourth soda less than Bob enjoys his first.
    Bob's second soda is less enjoyable than his first soda.
  • As Shana's consumption of tacos decreases, her
    marginal utility from tacos increases.
    total utility from tacos increases.
    both total and marginal utility from tacos decrease.
    marginal utility from tacos decreases.
  • Liz's marginal utility for two different goods is determined by
    her average utility for the two goods.
    All of the above answers are correct.
    summing her total utility from consumption of each good
    how much benefit she gets from another unit of each of those goods.
  • When Ramona is in consumer equilibrium,
    any change in prices would make her worse off.
    she is maximizing her utility, given her income and the prices.
    her total utilities of all goods are equal.
    her total utility per dollar spent is equal for all goods.
  • Suppose Jill's consumption bundle is made up of 2 goods, apples and bottles of juice. If the price of an apple increases, then Jill's budget line would
    shift towards the origin on the apples axis only.
    shift towards the origins on both products.
    not change.
    shift away from the origin on the bottles of juice axis.
  • If marginal utility is positive but diminishing, then total utility must be ___ as consumption of the good increases.
    positive and rising at a decreasing rate
    positive and rising at any rate
    decreasing
    positive and rising at an increasing rate
  • Tom's consumption possibilities is defined by
    his income only
    his preferences for consumption of the goods he consumes.
    the prices of the goods that he consumes only.
    his income and the prices of the goods he consumes.
  • Economists using marginal utility theory assume that consumers’ objectives are to
    maximize their total utility.
    none of the above
    maximize their marginal utility.
    maximize their income.
  • As more of a good is consumed, its marginal utility ___ and its total utility ___.
    rises |rises
    falls | rises
    rises | falls
    falls | falls
  • As Sean's consumption of rice goes up, his
    average utility from consuming rice increases.
    marginal utility from consuming rice increases.
    total utility from consuming rice increases.
    elasticity of utility from consuming rice increases.
  • A consumer maximizes total utility when all available income is spent and the
    marginal utility per dollar from each good is equal for all goods.
    total utility from all goods purchased is equal.
    dollars spent on the last unit of each good are equal for all goods.
    marginal utility from each good is equal for all goods.
  • A decrease in consumption will result in
    total utility increasing, but marginal utility decreasing.
    total utility decreasing, but marginal utility increasing.
    both total utility and marginal utility decreasing.
    both total utility and marginal utility increasing.
  • As an individual's consumption of a good increases,
    his or her total utility increases.
    All of the above answers are correct.
    his or her marginal utility increases.
    the price of the good increases.
  • Your marginal utility from a hamburger
    is always greater than your total utility from hamburgers.
    depends on how many hamburgers you've already eaten.
    is always greater than the price of a hamburger.
    is always greater than your average utility from a hamburger.
  • As consumption increases, total utility increases
    at an increasing rate.
    and marginal utility increases.
    at a constant rate.
    at a decreasing rate.
  • The marginal utility of a third skirt is
    three skirts times the price of a skirt.
    three times the average utility of the three skirts.
    the total utility of three skirts divided by three.
    the change in total utility from the third skirt.
  • To maximize her utility, Pat should spend all of her money and buy goods in a way that
    her price elasticity of demand for each good is the same.
    the marginal utility per dollar from each good is the same.
    her total expenditure on each good is the same.
    the marginal utility of the last unit of each good is the same.
  • Ricky is in a consumer equilibrium. Given the prices of goods, Ricky has allocated all his income such that his marginal utility per dollar spent is ___ for ___ goods.
    equal; all
    maximized; all
    as small as possible; all
    equal; normal
  • With a given income and prices of goods, Marcus will be in a consumer equilibrium if ___.
    he maximizes his total utility
    his marginal utility from all goods is the same
    his marginal utility from all goods is at its maximum
    he purchases the same amounts of all goods
  • If marginal utility is positive but diminishing, as more units of a good are consumed, then the total utility from the good must be
    positive and rising at any rate.
    positive and rising at a decreasing rate.
    falling.
    positive and rising at an increasing rate.
  • Which of the following is NOT an assumption of marginal utility theory?
    Utility can be measured and the units of utility are precisely defined.
    Marginal utility diminishes with more consumption.
    People derive utility from their consumption.
    More consumption yields more total utility.
  • Utility is best defined as
    the satisfaction from consuming a good.
    the amount one is willing to pay for a good.
    the price of a good.
    the practical usefulness of a good.
  • Liane maximizes her total utility when she allocates all of her available income such that the marginal utility per dollar spent on each good ___.
    is the same
    is increasing
    is diminishing
    is maximized
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