Quiz 10: Appendix: Consumer Preferences and Consumer Choice

An indifference curve is a line showing all of the consumption bundles that: A)an individual can purchase with a given income. B)yield the same total utility for an individual. C)yield the same marginal utility. D)have the same marginal rate of substitution.

When Laurie asks Matt if he wants a large popcorn and small soda or a large soda and small popcorn,Matt says,"Oh,I'm indifferent." This means Matt: A)doesn't want popcorn and soda. B)thinks both bundles give him the same utility. C)thinks neither bundle gives him utility. D)thinks the utility he gained from popcorn and soda exactly equals their cost.

(Figure and Table: Indifference Curve Map)Use Figure and Table An Indifference Curve Map.Combination _____ is preferred to combination _____. A)A;B B)B;D C)C;A D)B;C

Combinations of two goods that yield equal levels of utility are shown on a(n)_____ curve. A)indifference B)budget C)marginal utility D)utility-maximizing

The slope of a(n)_____ curve shows the rate at which two goods can be exchanged _____ the consumer's _____. A)marginal utility;by increasing;marginal utility B)indifference;without affecting;total utility C)utility;without affecting;budget D)indifference;without affecting;budget

An indifference curve shows combinations of two goods that yield: A)equal prices. B)equal money income. C)equal satisfaction. D)increasing prices.

If a consumer moves upward along an indifference curve,his or her total utility: A)remains constant. B)first decreases,then increases. C)increases. D)first increases,then decreases.

If two combinations of two goods yield the same level of satisfaction,then they are on: A)the same price line. B)the same budget constraint. C)the same indifference curve. D)different indifference curves.

Higher indifference curves represent: A)less utility than lower indifference curves. B)more utility than lower indifference curves. C)the same level of utility as lower indifference curves. D)unknown levels of utility compared to lower indifference curves.

In terms of indifference curves,an increase in total utility is represented by a _____ indifference curve. A)shift to the right to a higher B)shift to the left to a lower C)movement upward along an D)movement downward along an

If combination A lies on a higher indifference curve than combination B and combination B lies on a higher indifference curve than combination C,it must be that the total utility associated with combination A is _____ the total utility associated with combination C. A)less than B)more than C)equal to D)more than or equal to

A(n)_____ is a curve that shows all of the consumption bundles that yield the same level of total utility for an individual. A)budget line B)indifference curve C)utility function D)marginal rate of substitution

Use the following to answer questions 13-14: -(Table: Bundles of X and Y)Use Table Bundles of X and Y.Bundle(s): A)A and B are on the same indifference curve. B)A and C are on the same indifference curve. C)D is on the highest indifference curve. D)C is on the highest indifference curve,and bundles A and B are on the lowest indifference curve.

Use the following to answer questions 13-14: -(Table: Bundles of X and Y)Use Table Bundles of X and Y.According to the table: A)bundle D is preferred to bundles A and B. B)the consumer is indifferent among bundles A,B,and C. C)bundles C and D are both preferred to bundles A and B. D)bundle C is preferred to all other bundles.

Consumption bundles that yield equal levels of total utility are shown on the same: A)budget line. B)marginal utility curve. C)indifference curve. D)utility maximizing curve.

If a consumer moves downward along an indifference curve,his or her total utility: A)remains constant. B)first decreases,then increases. C)decreases. D)first increases,then decreases.

Assume that two combinations of two goods yield the same level of satisfaction.We can conclude that these combinations are always on: A)the same price line. B)the same budget constraint. C)the same indifference curve. D)different indifference curves.

A curve that represents combinations of two goods that yield equal levels of satisfaction is a(n): A)indifference curve. B)budget curve. C)marginal utility curve. D)price-consumption curve.

Higher indifference curves represent _____ lower curves. A)less utility than B)more utility than C)the same utility as D)either more or less utility than

Higher total utility is represented by _____ indifference curve. A)a higher B)a lower C)movement leftward along an D)movement rightward along an

Greater levels of utility are represented by: A)indifference curves that are farther from the origin. B)indifference curves that are closer to the origin. C)moving up to the left on the same indifference curve. D)moving down to the right on the same indifference curve.

One point on a standard indifference curve is 8 cookies and 2 brownies;another is 6 cookies and 4 brownies.Which of the following combinations of cookies and brownies could lie on this indifference curve? A)6 cookies and 10 brownies B)7 cookies and 6 brownies C)4 cookies and 4 brownies D)4 cookies and 8 brownies

Use the following to answer questions 23-24: -(Figure: Indifference Curve Map I)Use Figure Indifference Curve Map I.It shows that: A)bundles B and D provide the same level of utility. B)bundle A is preferred to bundle B. C)bundle D is preferred to bundle C,which is preferred to bundles A and B. D)bundle C provides the highest level of utility.

Use the following to answer questions 23-24: -(Figure: Indifference Curve Map I)Use Figure Indifference Curve Map I.It shows that: A)at point A utility is higher than it is at point B. B)utility is diminishing on I₁,constant on I₂,and increasing on I₃. C)utility is higher at point D than at point A. D)the marginal utility of e-books is positive,while the marginal utility of cell phone apps is negative.

For most goods,indifference curves: A)may intersect. B)slope upward. C)are concave from the origin. D)slope downward.

For most goods,as we move down an indifference curve: A)the slope gets flatter. B)the slope gets steeper. C)the slope stays the same. D)total utility decreases.

Which of the following is NOT TRUE of indifference curves for ordinary goods? A)They never cross. B)They slope downward. C)They are convex from the origin. D)Indifference curves farther from the origin have lower levels of utility.

The slope of a(n)_____ curve shows the rate at which two goods can be exchanged _____. A)indifference;without changing the total budget B)utility;without changing the total budget C)indifference;without changing total utility D)marginal utility;to increase the consumer's marginal utility

An indifference curve typically: A)slopes downward. B)shows combinations of two goods that yield equal money income. C)slopes upward. D)is concave.

One point on an indifference curve that displays a diminishing marginal rate of substitution between apples and oranges is 10 apples and 2 oranges;another is 8 apples and 4 oranges.Which of the following combinations of apples and oranges could also lie on this indifference curve? A)10 apples and 6 oranges B)6 apples and 7 oranges C)9 apples and 4 oranges D)8 apples and 3 oranges

Manny consumes only bananas and DVDs,and he is on his highest possible indifference curve.Two bundles on this indifference curve are bundle A (5 bananas and 2 DVDs),and bundle B (3 bananas and 3 DVDs).Between points A and B,what is Manny's marginal rate of substitution of bananas for DVDs? A)1 B)2 C)0.5 D)1.33

Max consumes only yogurt and almonds,and he is on his highest possible indifference curve.Bundle A (4 yogurts and 2 almonds)and bundle B (3 yogurts and 3 almonds)are on this indifference curve.Between points A and B,what is Max's marginal rate of substitution of yogurt for almonds? A)1 B)2 C)3 D)1.33

Consumers buy both alcoholic and nonalcoholic beverages.If the government tries to discourage people from drinking alcoholic beverages by imposing an excise tax on them but gives consumers an income subsidy to keep the consumers on their original indifference curves: A)the same amount of both goods will be consumed. B)fewer alcoholic and more nonalcoholic beverages will be consumed. C)more alcoholic and fewer nonalcoholic beverages will be consumed. D)it is impossible to determine what will happen to the consumption of alcoholic and more nonalcoholic beverages.

Javon is consuming his optimal utility-maximizing consumption bundle of lobster and macaroni-and-cheese dinners.Call this bundle A.His income is $100,the price of a macaroni-and-cheese dinner is $5,and the price of a lobster is $20.Put lobsters on the vertical axis and put macaroni-and-cheese dinners on the horizontal axis.His income increases to $500 and the prices of macaroni-and-cheese dinners and lobster remain constant.With the increase in income,Javon changes his consumption of the two goods and now maximizes utility at bundle B.If macaroni-and-cheese dinners are an inferior good for Javon: A)at bundle B,Javon consumes more macaroni-and-cheese dinners. B)at bundle B,Javon consumes less lobster. C)at bundle A and bundle B,the marginal utility of lobster is 5. D)at bundle B,Javon consumes more lobster.

Suppose peanut butter is an inferior good for Ilya and the price of peanut butter rises.What will happen to Ilya's consumption of peanut butter? A)The substitution effect will cause an increase in the consumption of peanut butter. B)The substitution effect will cause a decrease in the consumption of peanut butter and the income effect will cause an increase in the consumption of peanut butter. C)The substitution effect will cause a decrease in the consumption of peanut butter. D)The income effect will cause an increase in the consumption of peanut butter.

In terms of indifference curves,a demand curve is generated by changes in: A)the income effect. B)the substitution effect. C)the price of one good. D)the price of both goods simultaneously.

A _____ can be generated from indifference curves by changing _____. A)supply curve;the price of both goods simultaneously B)demand curve;the price of one good C)demand curve;income D)budget line;utility

Use the following to answer questions 133-136: -(Figure: Indifference Curves and Consumption Bundles)Use Figure Indifference Curves and Consumption Bundles.For this consumer pizza is a(n)_____ good and hot dogs are a(n)_____ good. A)normal;inferior B)inferior;normal C)normal;normal D)inferior;inferior

Use the following to answer questions 133-136: -(Figure: Indifference Curves and Consumption Bundles)Use Figure Indifference Curves and Consumption Bundles.The lines AA and BC are parallel.The optimal consumption point could shift from b to c as a result of any of the following EXCEPT: A)an equal percentage increase in the prices of hot dogs and pizza while income is unchanged. B)a decrease in income with prices constant. C)a change in tastes. D)an equal percentage increase in the prices of hot dogs and pizza while income is unchanged or a decrease in income with prices constant.

Use the following to answer questions 133-136: -(Figure: Indifference Curves and Consumption Bundles)Use Figure Indifference Curves and Consumption Bundles.In the figure,the initial optimum is at a.The price of hot dogs increases,and the new equilibrium point is c.The change in hot dog consumption due to the income effect of the price change is: A)H₃ to H_2. B)H₃ to H_1. C)H₂ to H_1. D)H₁ to H_2.

Use the following to answer questions 133-136: -(Figure: Indifference Curves and Consumption Bundles)Use Figure Indifference Curves and Consumption Bundles.In the figure,the initial optimum is at a.The price of hot dogs now increases.The change in hot dog consumption due to the substitution effect is: A)H₃ to H_2. B)H₃ to H_1. C)H₂ to H_1. D)H₁ to H_2.

Use the following to answer questions 137-140: -(Figure: The Consumption of Video Games and E-Books)Use Figure The Consumption of Video Games and E-Books.Which chart shows the effect of a decrease in income when both video games and e-books are normal goods? A)A B)B C)C D)D

Use the following to answer questions 137-140: -(Figure: The Consumption of Video Games and E-Books)Use Figure The Consumption of Video Games and E-Books.Which chart shows the effects of a decrease in income when video games are an inferior good and e-books are a normal good? A)A B)B C)C D)D

Use the following to answer questions 137-140: -(Figure: The Consumption of Video Games and E-Books)Use Figure The Consumption of Video Games and E-Books.Which chart shows the effects of an increase in the price of video games when video games and e-books are substitutes but not perfect substitutes? A)A B)B C)C D)D

Use the following to answer questions 137-140: -(Figure: The Consumption of Video Games and E-Books)Use Figure The Consumption of Video Games and E-Books.Which chart in the figure shows the effects of an increase in the price of video games when video games and e-books are complements but not perfect complements? A)A B)B C)C D)D

Use the following to answer questions 141-148: -(Figure: Harold's Indifference Curves)Use Figure Harold's Indifference Curves.If the price of bread is $1 per loaf,the price of cheese is $2 per pound,and Harold has $10 to spend on bread and cheese,Harold's optimal consumption bundle is _____ loaves of bread and _____ pounds of cheese. A)6;4 B)4;3 C)3;2 D)2;8

Use the following to answer questions 141-148: -(Figure: Harold's Indifference Curves)Use Figure Harold's Indifference Curves.If the price of bread is $1 per loaf,the price of cheese is $2 per pound,and Harold has $14 to spend on bread and cheese,Harold's optimal consumption bundle is _____ loaves of bread and _____ pounds of cheese. A)6;4 B)4;3 C)3;2 D)2;8

Use the following to answer questions 141-148: -(Figure: Harold's Indifference Curves)Use Figure Harold's Indifference Curves.Given that the price of bread is $1 per loaf and the price of cheese is $2 per pound,as Harold's income increases from $10 to $14,we can determine that bread is a(n)_____ good and cheese is a(n)_____ good. A)inferior;inferior B)normal;inferior C)inferior;normal D)normal;normal

Use the following to answer questions 141-148: -(Figure: Harold's Indifference Curves)Use Figure Harold's Indifference Curves.If the price of bread is $2 per loaf,the price of cheese is $4 per pound,and Harold has $28 to spend on bread and cheese,Harold's optimal consumption bundle is _____ loaves of bread and _____ pounds of cheese. A)6;4 B)4;3 C)3;2 D)2;8

Use the following to answer questions 141-148: -(Figure: Harold's Indifference Curves)Use Figure Harold's Indifference Curves.If the price of bread is $0.50 per loaf,the price of cheese is $1 per pound,and Harold has $7 to spend on bread and cheese,Harold's optimal consumption bundle is _____ loaves of bread and _____ pounds of cheese. A)6;4 B)4;3 C)3;2 D)2;8

Use the following to answer questions 141-148: -(Figure: Harold's Indifference Curves)Use Figure Harold's Indifference Curves.If the price of bread is $2 per loaf,the price of cheese is $2 per pound,and Harold has $10 to spend on bread and cheese,Harold's optimal consumption bundle is _____ loaves of bread and _____ pounds of cheese. A)6;4 B)4;3 C)3;2 D)2;8

Use the following to answer questions 141-148: -(Figure: Harold's Indifference Curves)Use Figure Harold's Indifference Curves.The price of cheese is $2 per pound and Harold has $10 to spend on bread and cheese.As the price of bread rises from $1 to $2 per loaf,his consumption of bread: change? A)increases from 2 to 3 loaves. B)decreases from 3 to 2 loaves. C)increases from 3 to 4 loaves. D)decreases from 4 to 3 loaves.

Use the following to answer questions 141-148: -(Figure: Harold's Indifference Curves)Use Figure Harold's Indifference Curves.If the price of cheese is $2 per pound and Harold has $10 to spend on bread and cheese,Harold _____ his consumption of cheese as the price of bread rises from $1 per loaf to $2 per loaf,indicating that bread and cheese are _____. A)increases;substitutes B)increases;complements C)decreases;substitutes D)decreases;complements

Use the following to answer questions 149-154: -(Figure: The Optimal Consumption Bundle)Use Figure The Optimal Consumption Bundle.If the price of restaurant meals _____,then the optimal consumption bundle will be on _____ indifference curve. A)increases;a higher B)decreases;a higher C)decreases;a lower D)increases;the same

Use the following to answer questions 149-154: -(Figure: The Optimal Consumption Bundle)Use Figure The Optimal Consumption Bundle.Which of the following could lead to an optimal consumption bundle on indifference curve I₃? A)an increase in income B)an increase in the price of restaurant meals C)an increase in the price of rooms D)a decrease in income

Use the following to answer questions 149-154: -(Figure: The Optimal Consumption Bundle)Use Figure The Optimal Consumption Bundle.Which of the following could lead to an optimal consumption bundle on indifference curve I₃? A)a decrease in income B)a decrease in the price of restaurant meals C)an increase in the price of rooms D)an increase in the price of restaurant meals

Use the following to answer questions 149-154: -(Figure: The Optimal Consumption Bundle)Use Figure The Optimal Consumption Bundle.Which of the following could lead to an optimal consumption bundle on indifference curve I₃? A)a decrease in income B)an increase in the price of restaurant meals C)a decrease in the price of rooms D)an increase in the price of rooms

Use the following to answer questions 149-154: -(Figure: The Optimal Consumption Bundle)Use Figure The Optimal Consumption Bundle.Which of the following could lead to an optimal consumption bundle on indifference curve I₁? A)an increase in income B)a decrease in the price of restaurant meals C)a decrease in the price of rooms D)a decrease in income

Use the following to answer questions 149-154: -(Figure: The Optimal Consumption Bundle)Use Figure The Optimal Consumption Bundle.Which of the following could lead to an optimal consumption bundle on indifference curve I₁? A)an increase in income B)an increase in the price of restaurant meals C)a decrease in the price of rooms D)a decrease in the price of restaurant meals

Use the following to answer questions 158-165: -(Figure: Consumer Equilibrium II)Use Figure Consumer Equilibrium II.The HIGHEST level of total utility is associated with point _____ on indifference curve _____. A)H;C B)I;B C)G;B D)J;A

Use the following to answer questions 158-165: -(Figure: Consumer Equilibrium II)Use Figure Consumer Equilibrium II.The LOWEST level of total utility shown in the figure is associated with point _____ on curve _____. A)H;A B)I;B C)G;C D)J;A

Use the following to answer questions 158-165: -(Figure: Consumer Equilibrium II)Use Figure Consumer Equilibrium II.A level of total utility NOT attainable is at point: A)G. B)K. C)I. D)J.

Use the following to answer questions 158-165: -(Figure: Consumer Equilibrium II)Use Figure Consumer Equilibrium II.Ashyra consumes at point G.Ashyra would be able to realize more total utility by choosing point _____,all other things held equal. A)J B)K C)I D)H

Use the following to answer questions 158-165: -(Figure: Consumer Equilibrium II)Use Figure Consumer Equilibrium II.Ashyra consumes at point I.Ashyra could gain more utility by choosing point _____,all other things held equal. A)J B)G C)K D)The consumer doesn't have enough income to gain more utility.

Use the following to answer questions 158-165: -(Figure: Consumer Equilibrium II)Use Figure Consumer Equilibrium II.Ashyra would maximize her utility at point _____ with the consumption of _____ olive oil and _____ dish soap. A)J;S;P B)I;S;P C)J;N;F D)I;N;M

Use the following to answer questions 158-165: -(Figure: Consumer Equilibrium II)Use Figure Consumer Equilibrium II.Which of the following statements is TRUE? A)Point I is the point of utility maximization. B)At the point of utility maximization,the rate at which Ashyra is willing to exchange one good for another is less than the rate at which the goods can be exchanged in the market. C)At point I,P_y.= P_x. D)At point I,Ashyra has some income left for saving.

Use the following to answer questions 158-165: -(Figure: Consumer Equilibrium II)Use Figure Consumer Equilibrium II.Which of the following is TRUE? A)To increase utility beyond that received at point I requires an increase in the price of olive oil. B)Point J could be attained with an increase in Ashyra's income. C)An increase in the prices of olive oil and dish soap would allow Ashyra to attain point J. D)To increase utility beyond that received at point I requires an increase in the price of dish soap.

Use the following to answer questions 166-174: -(Figure: Consumer Equilibrium III)Use Figure Consumer Equilibrium III.The highest level of total utility attainable is associated with point _____ on _____. A)C;I₃ B)E;I₂ C)A;I₂ D)B;I₁

Use the following to answer questions 166-174: -(Figure: Consumer Equilibrium III)Use Figure Consumer Equilibrium III.The lowest level of total utility at which Ivan still spends all of his income is associated with point _____ on _____. A)A;I₃ B)C;I₃ C)E;I₂ D)B;I₁

Use the following to answer questions 166-174: -(Figure: Consumer Equilibrium III)Use Figure Consumer Equilibrium III.A level of total utility NOT attainable is at point: A)A. B)F. C)E. D)B.

Use the following to answer questions 166-174: -(Figure: Consumer Equilibrium III)Use Figure Consumer Equilibrium III.Which of the following statements is TRUE? A)Q₄ indicates the price of placemats. B)Q₈ indicates the price of tamales. C)Points A and E represent the same level of total utility. D)Kurt is better off at point E than at point A.

Use the following to answer questions 166-174: -(Figure: Consumer Equilibrium III)Use Figure Consumer Equilibrium III.Kurt consumes at point A.Other things held equal,Kurt would be able to realize more total utility by choosing point: A)E. B)B. C)C. D)F.

Use the following to answer questions 166-174: -(Figure: Consumer Equilibrium III)Use Figure Consumer Equilibrium III.Kurt consumes at point C.If income remains unchanged,Kurt could gain more utility by choosing point: A)B. B)A. C)F. D)E.

Use the following to answer questions 166-174: -(Figure: Consumer Equilibrium III)Use Figure Consumer Equilibrium III.Kurt would maximize his utility at point _____ with the consumption of _____. A)B;Q₆ and Q₃ B)E;Q₁ and Q₇ C)F;Q₅ and Q₄ D)E;Q₅ and Q₂

Use the following to answer questions 166-174: -(Figure: Consumer Equilibrium III)Use Figure Consumer Equilibrium III.Given the figure,which of the following statements is TRUE? A)At the point of utility maximization,the rate at which Kurt is willing to exchange one good for another is less than the rate at which the goods can be exchanged in the market. B)An increase in the prices of tamales and placemats would allow Kurt to attain point B. C)At point E,P_x = P_y. D)Point E is the point of utility maximization under current budget constraints.

Use the following to answer questions 166-174: -(Figure: Consumer Equilibrium III)Use Figure Consumer Equilibrium III.Given the figure,which of the following is TRUE? A)Point C is preferable to point E. B)At point E,P_x = P_y C)Point B could be attained with an increase in the consumer's income. D)To increase utility beyond that received at point E requires a change in the preferences of the consumer.

Use the following to answer questions 175-184: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.The highest level of utility shown in the figure is associated with indifference curve: A)X. B)Y. C)Z. D)Y or Z.

Use the following to answer questions 175-184: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.The lowest level of utility shown in the figure is associated with indifference curve: A)X. B)Y. C)Z. D)X or Y.

Use the following to answer questions 175-184: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.The highest level of utility is at point: A)G. B)H. C)I. D)J.

Use the following to answer questions 175-184: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.The highest attainable level of utility,given budget constraint FL,is at point: A)G. B)H. C)I. D)J.

Use the following to answer questions 175-184: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.An unattainable level of utility,given budget constraint FL,is at point: A)G. B)H. C)I. D)J.

Use the following to answer questions 175-184: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.Assume that you are consuming the combination of goods at point G.Given the budget constraint FL,utility: A)can be increased by consuming more train tickets and fewer nights in a hotel room. B)can be increased by consuming fewer train tickets and more nights in a hotel room. C)can be increased by consuming more of both goods. D)cannot be increased.

Use the following to answer questions 175-184: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.Assume that you are consuming the combination of goods at point K.Given the budget constraint FL,utility: A)can be increased by consuming more nights in a hotel room and fewer train tickets. B)can be increased by consuming fewer nights in a hotel room and more train tickets. C)can be increased by consuming more of both goods. D)cannot be increased.

Use the following to answer questions 175-184: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.Assume that you are consuming the combination of goods at point I.Given the budget constraint FL,utility: A)cannot be increased. B)can be increased by consuming more nights in a hotel room and fewer train tickets. C)can be increased by consuming fewer nights in a hotel room and more train tickets. D)can be increased by consuming more of both goods.

Use the following to answer questions 175-184: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.Assume that you are consuming the combination of goods at point G.Given the budget constraint FL,utility can be increased by moving to point: A)H. B)I. C)J. D)K.

Use the following to answer questions 175-184: -(Figure: Consumer Equilibrium IV)Use Figure Consumer Equilibrium IV.Assume that you are consuming the combination of goods at point K.Given the budget constraint FL,utility can be increased by moving to point: A)F. B)G. C)H. D)I.

One point on an indifference curve drawn between mangoes and vegetable broth is the consumption bundle consisting of five mangoes and three boxes of vegetable broth.This means that Sharri is indifferent between five mangoes and three boxes of vegetable broth.

As an individual moves down his or her indifference curve,total utility remains constant.

Suppose Joe derives 327 utils from consuming 1 dozen crab cakes and 11 pairs of socks.If he also derives 327 utils from 2 dozen crab cakes and 5 pairs of socks,Joe is indifferent between those combinations of crab cakes and socks.

The following bundles can all be on the same indifference curve.Bundle A: 4 enchiladas,1 burrito;bundle B: 3 enchiladas,3 burritos;bundle C: 2 enchiladas,2 burritos.

Maria derives 288 utils from buying 2 pairs of hiking boots and 4 saws.She gets 313 utils from buying 1 pair of hiking boots and 7 saws.Maria is indifferent between these two combinations of hiking boots and saws.

Janella consumes only bananas and passion fruit.It is not possible for Janella's indifference curves to cross one another at any point.

The assumption that the farther from the origin an indifference curve is,the higher the level of utility it indicates implies that more is better.

Because of diminishing marginal utility,indifference curves are convex to the origin.

Diminishing marginal utility occurs with increasing total utility.

Shirley knows her marginal rate of substitution of mangoes for bananas is equal to 3.The price of bananas is $0.50 and the price of mangoes is $1.00.Shirley should buy more mangoes.

At the video store,Lucian narrows his selection to either a $2 videocassette of The Evil Dead or a $4 DVD of Finding Nemo.Lucian finally flips a coin to decide which movie to rent.This must mean that Lucian's marginal rate of substitution of The Evil Dead for Finding Nemo is 0.5.

Henry and Anne have identical incomes.Both buy only sardines and ice cream.Since they face the same prices for the two goods,their optimal consumption bundles must be identical.

Mr.Coiner is always willing to exchange two nickels for a dime,no matter how many nickels and dimes he has.This implies that nickels and dimes are ordinary goods for Mr.Coiner.

Pooh spends all of his income on honey and maple syrup.Because he views honey and maple syrup as perfect substitutes,he is willing to substitute honey for maple syrup at the constant rate of 1 teaspoon of honey to 2 teaspoons of maple syrup.If the price of honey in terms of maple syrup is 2.2,Pooh's optimal consumption bundle will consist entirely of maple syrup.

Ms.Stardoe gets utility from coffee and cream,but only if they are consumed in the precise ratio of 8 ounces of coffee to 2 ounces of cream.This implies that coffee and cream are ordinary goods for Ms.Stardoe.

If Ian's indifference curve between guitars and Cadillacs is shaped like a right angle,then he considers the two goods perfect complements.

Miguel eats only burgers with onion rings.Miguel's indifference curve between burgers and onion rings must be a straight line.

When we graphically isolate the substitution effect of a change in the price of one good,utility is held constant.

A Giffen good is an inferior good for which the income effect dominates the substitution effect.

Use the following to answer questions 214-216: -(Figure: Oreos and Apples)Use Figure Oreos and Apples,which provides an indifference curve map for Diego.The consumption bundle that provides the highest level of utility is bundle: A)A or C. B)B or D. C)E or F. D)A or B.

Use the following to answer questions 214-216: -(Figure: Oreos and Apples)Use Figure Oreos and Apples,which provides an indifference curve map for Diego.Diego prefers: A)E to F. B)F to E. C)A to E. D)D to C.

Use the following to answer questions 214-216: -(Figure: Oreos and Apples)Use Figure Oreos and Apples,which provides an indifference curve map for Diego.As Diego moves along an indifference curve from point F to point E,he buys _____ Oreos to obtain _____ apples. A)fewer;more B)more;more C)the same number of;more D)no;more

An indifference curve map illustrates _____ levels of utility,while each indifference curve in the map indicates consumption bundles that yield _____ level of utility for an individual. A)different;the same B)the same;a different C)the same;the same D)different;a different

To find her optimal consumption bundle,Vanessa would have to: A)calculate the numerical value of the utility she receives from each specific consumption bundle. B)rank-order consumption bundles based on the level of utility she receives from each one. C)calculate her budget for each consumption bundle and identify the substitution and income effects of each bundle. D)choose her bundles in an irrational manner.

When an individual's consumption of an additional unit of a good generates a smaller increase in total utility than the previous unit consumed,then this person's indifference curve will be: A)a straight line. B)convex,or bowed toward the origin. C)concave,or bowed away from the origin. D)a right angle.

The assumption that more is preferred to less explains why indifference curves: A)that lie closer to the origin represent higher levels of utility. B)that lie farther from the origin represent higher levels of utility. C)cross frequently. D)slope upward and away from the origin.

Diminishing marginal utility is the reason most indifference curves: A)slope upward. B)slope downward. C)are vertical. D)are horizontal.

Use the following to answer questions 222-224: -(Table: Madeline's Preferences for T-Shirts and Coffee)Use Table Madeline's Preferences for T-Shirts and Coffee.Assume each consumption bundle provides the same level of utility for Madeline.Suppose Madeline is consuming bundle C.If she changes her purchases to bundle D,this means that she: A)gives up 2 T-shirts to obtain 1 more cup of coffee. B)gives up 1 cup of coffee to obtain 2 more T-shirts. C)will now have 11 cups of coffee and 40 T-shirts. D)doesn't give up any T-shirts to obtain more coffee.

Use the following to answer questions 222-224: -(Table: Madeline's Preferences for T-Shirts and Coffee)Use Table Madeline's Preferences for T-Shirts and Coffee.Assume each consumption bundle provides the same level of utility.Suppose Madeline is consuming bundle A but then changes her consumption and slowly moves along her indifference curve to bundles B,C,D,and finally E.As she moves toward bundle E,she gives up: A)the same number of T-shirts to obtain another cup of coffee. B)an increasing numbers of T-shirts to obtain another cup of coffee. C)a decreasing numbers of T-shirts to obtain another cup of coffee. D)no T-shirts to obtain another cup of coffee.

Use the following to answer questions 222-224: -(Table: Madeline's Preferences for T-Shirts and Coffee)Use Table Madeline's Preferences for T-Shirts and Coffee.Assume each consumption bundle provides the same level of utility.As Madeline moves from bundle A to bundle E,her total utility: A)decreases. B)increases. C)stays the same. D)is zero regardless of which bundle she chooses.

Ellen consumes goods X and Y.As she consumes less X,she must be compensated with additional units of Y,and her marginal rate of substitution of X for Y decreases as she consumes more Y.This means that goods X and Y are: A)ordinary. B)unique. C)complements. D)substitutes.

A typical indifference curve is _____,and its slope is the _____ of the good on the horizontal axis divided by the marginal utility of the good on the vertical axis. A)downward-sloping;negative of the marginal utility B)upward-sloping;negative of the marginal utility C)downward-sloping;negative of the total utility D)downward-sloping;total cost

The ratio of the prices of two goods is equal to the ratio of the marginal utilities of the two goods at: A)the vertical intercept of the budget line. B)the optimal consumption bundle. C)the horizontal intercept of the budget line. D)the intersection of the budget line with the highest indifference curve.

Since indifference curves depend on the _____ for individuals,this means that two consumers with the same income _____. A)utility function;must consume different amounts of the two goods B)utility function;may consume different amounts of the two goods C)optimal utility rule;must consume different amounts of the two goods D)marginal utility function;have the same marginal utility for two goods.

(Scenario: Music Downloads and Streamed Movies)Read the scenario Music Downloads and Streamed Movies.Which of the following equations expresses Phillip's budget line? Scenario: Music Downloads and Streamed Movies Phillip has an income of $300 per month,which he uses to purchase music downloads (MD)and streamed movies (SM).Each music download costs $1 and each streamed movie costs $5. A)300 = 1MD + 5SM B)SM = 300 - 1X C)300 = 1 / MD + 5 / SM D)SM = 300 + 5SM

(Scenario: Music Downloads and Streamed Movies)Read the scenario Music Downloads and Streamed Movies.Suppose Phillip's income falls by half,and the prices for both music downloads and streamed movies also fall by half.As a result of this,Phillip: Scenario: Music Downloads and Streamed Movies Phillip has an income of $300 per month,which he uses to purchase music downloads (MD)and streamed movies (SM).Each music download costs $1 and each streamed movie costs $5. A)can buy fewer music downloads if he spends all of his income on music downloads. B)can buy fewer streamed movies if he spends all of his income on streamed movies. C)will not notice any change in his budget line. D)will undergo a parallel shift out of his budget line.

(Scenario: Music Downloads and Streamed Movies)Read the scenario Music Downloads and Streamed Movies.Phillip's optimal consumption bundle will be one whose: Scenario: Music Downloads and Streamed Movies Phillip has an income of $300 per month,which he uses to purchase music downloads (MD)and streamed movies (SM).Each music download costs $1 and each streamed movie costs $5. A)budget line is tangent to his highest indifference curve. B)budget line intersects his highest indifference curve. C)budget line intersects the music download axis. D)indifference curve intersects the streamed movies axis.

(Scenario: Music Downloads and Streamed Movies)Read the scenario Music Downloads and Streamed Movies.The slope of Phillip's budget line is equal to: Scenario: Music Downloads and Streamed Movies Phillip has an income of $300 per month,which he uses to purchase music downloads (MD)and streamed movies (SM).Each music download costs $1 and each streamed movie costs $5. A)-0.2. B)-5. C)-0.4. D)-2.5.

Two goods in an individual's consumption bundle are perfect substitutes.For a given amount of income,the individual's optimal consumption bundle will contain: A)exactly 50% of each of the two goods. B)only the good with the lower price. C)only the good with the higher price. D)all of the good on the horizontal axis.

For some people,coffee and milk are perfect complements.Their indifference curves are: A)right angles. B)straight lines between the X and Y axis. C)straight lines out of the origin. D)regular downward-sloping indifference curves,but their budget lines are right angles.

Paola gets 50 units of utility when she consumes 4 cupcakes and 2 glasses of milk.She also gets 50 units of utility when she consumes 3 cupcakes and 2 glasses of milk.This means that: A)Paola likes milk better than cupcakes. B)Paola likes cupcakes better than milk. C)these combinations lie on the same indifference curve. D)one of these combinations lies on a higher indifference curve.

(Scenario: E-Books and Sports Tickets)Read the scenario E-Books and Sports Tickets.Measure e-books on the horizontal axis and sports tickets on the vertical axis.Suppose the price of e-books decreases.Holding everything else constant,Phillip's budget line has become _____,and his optimal consumption bundle will be on a _____ indifference curve. Scenario: E-Books and Sports Tickets Phillip has an income of $300 per month,which he uses to purchase two goods,e-books and sports tickets.Each e-book costs $10,and each ticket costs $15. A)flatter higher B)steeper;lower C)flatter;lower D)steeper;higher

(Scenario: E-Books and Sports Tickets)Read the scenario E-Books and Sports Tickets.Suppose Phillip discovers that if he spends all of his money on sports tickets,he can buy more sports tickets than he could previously because something changed.This is a result of a(n)_____ in the price of _____. Scenario: E-Books and Sports Tickets Phillip has an income of $300 per month,which he uses to purchase two goods,e-books and sports tickets.Each e-book costs $10,and each ticket costs $15. A)increase;tickets B)decrease;tickets C)increase;e-books D)decrease;e-books

(Scenario: E-Books and Sports Tickets)Read the scenario E-Books and Sports Tickets.Phillip gets an increase in the amount of his monthly income allotted for e-books and sports tickets.Holding everything else constant,Phillip's budget line has: Scenario: E-Books and Sports Tickets Phillip has an income of $300 per month,which he uses to purchase two goods,e-books and sports tickets.Each e-book costs $10,and each ticket costs $15. A)shifted parallel inward to the origin. B)rotated around the lower-priced good. C)rotated around the higher-priced good. D)shifted parallel outward away from the origin.

Use the following to answer questions 240-244: -(Figure: Kristin's Budget Line)Use Figure Kristin's Budget Line.The price of a cup of cappuccino is $3,and the price of an apple is $1.Kristin's income is: A)$50. B)$120. C)$60. D)$20.

Use the following to answer questions 240-244: -(Figure: Kristin's Budget Line)Use Figure Kristin's Budget Line.The price of a cup of cappuccino is $3,and the price of an apple is $1.Given her income and the prices of the two goods,Kristin can consume _____ cappuccinos and _____ apples. A)20;10 B)15;15 C)15;20 D)10;40

Use the following to answer questions 240-244: -(Figure: Kristin's Budget Line)Use Figure Kristin's Budget Line.The price of a cup of cappuccino is $3,and the price of an apple is $1.Suppose Kristin initially consumes 10 cups of cappuccino and 30 apples.Then the price of apples increases to $3 each and the price of a cappuccino remains unchanged.As a result of this price change,Kristin's optimal consumption bundle changes,reflected by a decrease in the consumption of both apples and cappuccinos.This suggests that: A)apples are a Giffen good. B)cappuccino is a Giffen good. C)both apples and cappuccino are normal goods. D)apples are an inferior good.

Use the following to answer questions 240-244: -(Figure: Kristin's Budget Line)Use Figure Kristin's Budget Line.The price of a cup of cappuccino is $3,and the price of an apple is $1.Suppose Kristin initially consumes 10 cups of cappuccino and 30 apples.Then,the price of apples increases to $3 each and the price of cappuccino remains unchanged.As a result of the price change,Kristin's optimal consumption bundle changes,reflected by a decrease in the consumption of both apples and cappuccinos.If Kristin is to maintain the same level of utility as before the price change,she must: A)increase her income. B)decrease her income. C)keep her income the same,since only one good's price changed. D)increase her income by $2.

Use the following to answer questions 240-244: -(Figure: Kristin's Budget Line)Use Figure Kristin's Budget Line.The price of a cup of cappuccino is $3,and the price of an apple is $1.Suppose Kristin initially consumes 10 cups of cappuccino and 30 apples.Then the price of apples increases to $3 each and the price of cappuccino remains unchanged.As a result of this price change,Kristin's optimal consumption bundle is now 9 cups of cappuccino and 11 apples.If Kristin's income could be adjusted so that she could maintain her initial level of utility after the price change,she would consume more cappuccino and more apples.This reflects: A)a substitution effect from the price change and an income effect from the income change. B)the substitution effect alone. C)the income effect alone. D)neither a substitution nor an income effect.