Deck 5: Demand

Question 1

The goal of utility maximization is to allocate your ________ in order to maximize your ________.

A)utility; spending
B)resources; satisfaction
C)time; work
D)resources; desires

Answer 1

resources; satisfaction

Question 2

During Thanksgiving you participated in a pumpkin-pie eating contest. You really enjoyed the first two pies, the third one was okay, but as soon as you ate the fourth one you became ill and lost the contest. You got ________ utility from eating the fourth pie than from eating the second pie.

A)less
B)more
C)the same amount of
D)less variable

Answer 2

less

Question 3

In some countries, medical care is provided free-of-charge to citizens and is paid for by the government. In those countries, medical care:

A)is not a scarce resource.
B)is available at zero opportunity cost.
C)is rationed by some non-monetary method.
D)does not exhibit diminishing marginal returns.

Answer 3

is rationed by some non-monetary method.

Question 4

After subsistence levels of food, shelter, and clothing have been provided, economists refer to all other goods and services as:

A)"needs".
B)"inferior goods".
C)"wants".
D)"luxuries".

Question 5

According to the law of demand, when the price of shoes ________, people will consume ________ shoes.

A)rises; more
B)falls; more
C)rises; the same amount
D)falls; the same amount

Question 6

Joe is shopping for a new computer. A computer can be delivered to Joe's home for $1,200. Alternatively, Joe can pick up the same computer at the warehouse for $1,000. How should Joe buy the computer?

A)Joe should drive to the warehouse because $1,000 is less than $1,200.
B)Joe should drive to the warehouse if his cost of driving to the warehouse is less than $200.
C)Joe should drive to the warehouse if his cost of driving to the warehouse is greater than $200.
D)Joe should drive to the warehouse because the $200 he would save by driving to the warehouse is more than 10% of the purchase price.

Question 7

According to economists, the satisfaction people get from their consumption activities is called:

A)demand.
B)utility.
C)a need.
D)a want.

Question 8

During Thanksgiving you participated in a pumpkin-pie eating contest. You really enjoyed the first two pies, the third one was okay, but as soon as you ate the fourth one you became ill and lost the contest. After the third pie, your total utility:

A)increased, but by less than for the first three pies.
B)decreased.
C)stayed the same.
D)was zero.

Question 9

Higher education is a ________ and assigned textbooks are ________.

A)need; needs
B)want; wants
C)need; wants
D)want; needs

Question 10

Taking a limousine to a five-star restaurant in New York is a:

A)necessity to Richie Rich but a luxury to Joe Average.
B)necessity to both Joe Average and Richie Rich.
C)want to both Joe Average and Richie Rich.
D)want to Richie Rich and a luxury to Joe Average.

Question 11

Sven likes to water ski, but can only water ski during the one week each year when he is on vacation. Therefore, he plans to ski every day, for eight hours a day. The first day, Sven skied for eight hours and enjoyed every hour. The second day, Sven slept in and then skied for seven hours, which was fun but not as much fun as the first day. The third day, Sven skied for six hours, but was starting to get a bit bored by the end. The fourth day, Sven skied for four hours and then took a nap. On the fifth day of Sven's vacation, Sven went blueberry picking all day. Sven's total utility ________ with each hour that he skied.

A)increased
B)decreased
C)remained constant
D)first increased than decreased

Question 12

Sven likes to water ski, but can only water ski during the one week each year when he is on vacation. Therefore, he plans to ski every day, for eight hours a day. The first day, Sven skied for eight hours and enjoyed every hour. The second day, Sven slept in and then skied for seven hours, which was fun but not as much fun as the first day. The third day, Sven skied for six hours, but was starting to get a bit bored by the end. The fourth day, Sven skied for four hours and then took a nap. On the fifth day of Sven's vacation, Sven went blueberry picking all day. On the fifth day of Sven's vacation, he had decided that another hour of skiing would yield:

A)more utility than blueberry picking.
B)the same level of utility as the day before.
C)less utility than blueberry picking.
D)no utility at all.

Question 13

In most markets, scarce goods or services are rationed among competing users using:

A)non-monetary prices.
B)monetary prices.
C)government organizations.
D)private organizations.

Question 14

Growing rice requires extensive irrigation in California. Economists consider water to be a ________ for rice farmers in California.

A)want
B)need
C)luxury
D)inferior good

Question 15

Shelter for homeless people is an example of:

A)a want.
B)a need.
C)something they can live without.
D)something hard to find.

Question 16

During Thanksgiving you participated in a pumpkin-pie eating contest. You really enjoyed the first two pies, the third one was okay, but as soon as you ate the fourth one you became ill and lost the contest. Your total utility ________ with the first three pies you ate.

A)increased
B)decreased
C)stayed the same
D)first increased than decreased

Question 17

As the price of computers falls, the quantity of computers demanded increases. This is an application of:

A)the law of supply.
B)the production possibilities curve.
C)the law of demand.
D)needs versus wants.

Question 18

During Thanksgiving you participated in a pumpkin-pie eating contest. You really enjoyed the first two pies, the third one was okay, but as soon as you ate the fourth one you became ill and lost the contest. You got ________ utility from eating the first pie than from eating the third pie.

A)less
B)more
C)the same amount of
D)less variable

Question 19

The law of demand indicates that as the cost of an activity:

A)falls, less of the activity will occur.
B)rises, more of the activity will occur.
C)rises, the level of the activity may or may not increase depending on the individual.
D)rises, less of the activity will occur.

Question 20

The tendency for consumers to purchase more of a good or service as its price falls is captured by the:

A)law of supply.
B)law of increasing cost.
C)Low-Hanging Fruit Principle.
D)law of demand.

Question 21

Suppose Chris's marginal utility from the first taco he eats is 15, and his marginal utility from the second taco he eats is 12. One can infer that:

A)Chris's total utility from eating two tacos is 27.
B)Chris should eat one taco.
C)Chris's average utility from eating two tacos is 27.
D)Chris should eat two tacos.

Question 22

When Lorenzo eats 1 slice of pizza for lunch, his total utility is 23, and when he eats 2 slices of pizza for lunch, his total utility is 42. Assuming that Lorenzo's marginal utility from eating pizza is always positive, we can infer that his total utility from eating 3 slices of pizza at lunch is:

A)greater than 42 and less than 84.
B)greater than 42 and less than 46.
C)greater than 42 and less than 61.
D)greater than 23 and less than 42.

Question 23

Pat's total utility after eating 99 Reese's Peanut Butter Cups was greater than his total utility after eating 100 Reese's Peanut Butter Cups. Therefore, Pat's marginal utility from the 100ᵗʰ peanut butter cup was:

A)positive, but less than one.
B)positive, but less than his marginal utility for the 99ᵗʰ peanut butter cup.
C)zero.
D)negative.

Question 24

Refer to the accompanying table. The marginal utility of the 3?? dinner is: $\begin{array}{|c|c|c|}\begin{array}{c}\text { Number of Dinners } \\\text { Out Per Week }\end{array} & \text { Total Utility } & \text { Marginal Utility } \\\hline 1 & 100 \\\hline 2 & & 75\\\hline 3 & 235 & \\\hline 4 & 250 & \\\hline\end{array}$

A)60.
B)75.
C)135.
D)160.

Question 25

Sven likes to water ski, but can only water ski during the one week each year when he is on vacation. Therefore, he plans to ski every day, for eight hours a day. The first day, Sven skied for eight hours and enjoyed every hour. The second day, Sven slept in and then skied for seven hours, which was fun but not as much fun as the first day. The third day, Sven skied for six hours, but was starting to get a bit bored by the end. The fourth day, Sven skied for four hours and then took a nap. On the fifth day of Sven's vacation, Sven went blueberry picking all day. Sven's marginal utility from his first hour of skiing was ________ his marginal utility from his tenth hour of skiing.

A)less than
B)greater than
C)the same as
D)more negative

Question 26

Refer to the accompanying table. The total utility of consuming two dinners out per week is: $\begin{array}{|c|c|c|}\begin{array}{c}\text { Number of Dinners } \\\text { Out Per Week }\end{array} & \text { Total Utility } & \text { Marginal Utility } \\\hline 1 & 100 \\\hline 2 & & 75\\\hline 3 & 235 & \\\hline 4 & 250 & \\\hline\end{array}$

A)less than 100.
B)75.
C)175.
D)160.

Question 27

Refer to the accompanying figure. Total utility increases with each additional pizza up to the ________ and then declines, but marginal utility ________ with each additional pizza consumed.

A)7ᵗʰ pizza; increases
B)6ᵗʰ pizza; increases
C)5ᵗʰ pizza; stays the same
D)6ᵗʰ pizza; decreases

Question 28

It is impossible for total utility to be ________ when marginal utility is ________.

A)increasing; increasing
B)decreasing; positive
C)positive; negative
D)increasing; decreasing

Question 29

As Lynn eats more pizza, we would typically expect her marginal utility from eating pizza to:

A)increase.
B)decrease.
C)stay the same.
D)equal the price of pizza.

Question 30

Refer to the accompanying figure. The total utility of consuming 4 pizzas a week is:

A)15
B)22.5
C)75
D)90

Question 31

Blair has vast riches and consumes thousands of dollars' worth of consumer goods each week, yet she is never satisfied. Why not?

A)People's wants are unlimited.
B)Blair fails to choose rationally.
C)The law of diminishing marginal utility shows that consuming too many material goods lowers total utility.
D)Utility is unrelated to the level of consumption.

Question 32

Laura's total utility from consuming 8, 9, and 10 bonbons is 35, 42, and 45, respectively. Her marginal utility from the 9ᵗʰ bonbon is ________.

A)77
B)7
C)42
D)4.67

Question 33

For Michael, the first cup of coffee he drinks every morning is heavenly. The second one is pretty good, but not as good as the first, and if he drinks a third cup he feels jittery and sick. For Michael, the marginal utility from drinking a cup of coffee is clearly:

A)decreasing.
B)increasing.
C)positive.
D)negative.

Question 34

The additional utility gained from consuming an additional unit of a good is called:

A)total utility.
B)marginal utility.
C)costly utility.
D)a util.

Question 35

Refer to the accompanying figure. The marginal utility of the 7ᵗʰ pizza is

A)100.
B)5.
C)-100.
D)-5.

Question 36

The term marginal utility denotes the amount by which ________ changes when consumption changes by ________ unit(s).

A)total utility; 1
B)demand; 10
C)demand; 1
D)total utility; 10

Question 37

Sven likes to water ski, but can only water ski during the one week each year when he is on vacation. Therefore, he plans to ski every day, for eight hours a day. The first day, Sven skied for eight hours and enjoyed every hour. The second day, Sven slept in and then skied for seven hours, which was fun but not as much fun as the first day. The third day, Sven skied for six hours, but was starting to get a bit bored by the end. The fourth day, Sven skied for four hours and then took a nap. On the fifth day of Sven's vacation, Sven went blueberry picking all day. Sven's vacation convinced him that:

A)even for activities he really enjoys, diminishing marginal utility eventually sets in.
B)blueberry picking yields higher total utility than does water skiing.
C)even for activities he really enjoys, total utility declines over time.
D)economic theory applies to things you buy, but not to recreational activities.

Question 38

Refer to the accompanying figure. The total utility of consuming two pizzas a week is:

A)25
B)30
C)55
D)75

Question 39

Refer to the accompanying figure. The marginal utility of the 6ᵗʰ pizza is:

A)95
B)100
C)5
D)17.5

Question 40

If marginal utility is positive, then as consumption increases:

A)the consumer will not experience diminishing marginal utility.
B)total utility will not change.
C)total utility will increase.
D)the demand curve will have a positive slope.

Question 41

Casey earns $150 a week and consumes only fish and shrimp. The price of fish is $3 a pound and the price of shrimp is $5 a pound. Casey can buy a maximum of ________ pounds of fish or a maximum of ________ pounds of shrimp.

A)30; 50
B)50; 30
C)15; 30
D)30; 15

Question 42

Cory gets 18, 23, and 25 units worth of total utility from consuming 10, 11, and 12 raw oysters, respectively, and the price per oyster is 25 cents. Thus, one can infer that Cory:

A)is not maximizing his utility.
B)is experiencing diminishing marginal utility.
C)should not consume any more oysters.
D)has consumed too many oysters.

Question 43

Refer to the accompanying table. The marginal utility of consuming apples is: $$\begin{array} { | c | c | } \hline \text { Number of Apples } & \begin{array} { c } \text { Tatal } \\\text { Utility }\end{array} \\\hline 1 &20 \\\hline 2 & 35 \\\hline 3 & 45 \\\hline 4 & 50 \\\hline 5 & 45 \\\hline\end{array}$$

A)constant.
B)first increasing, but decreasing after the fourth apple.
C)decreasing after the first apple.
D)constantly increasing.

Question 44

Refer to the accompanying figure. When Jeff goes from watching 3 to 4 movies a day, his total utility:

A)increases.
B)decreases.
C)does not change.
D)gets close to zero.

Question 45

Assume that Dusty has $30 in income, the price of a loaf of bread is $1.50, and the price of a jar of peanut butter is $3. Dusty can buy a maximum of ________ loaves of bread or a maximum of ________ jars of peanut butter.

A)20; 10
B)15; 15
C)10; 20
D)10; 5

Question 46

According to the law of diminishing marginal utility:

A)as you consume less of something, your total utility will decrease.
B)as you consume less of something, your marginal utility from consuming that good will increase.
C)you should never consume more of something if your marginal utility is decreasing.
D)if your total utility is increasing as you consume more of something, then your marginal utility must be increasing as well.

Question 47

Assume that Dusty has $30 in income, the price of a loaf of bread is $1.50, and the price of a jar of peanut butter is $3. At the original income of $30, if the price of a loaf of bread decreased to $1 and the price of a jar of peanut butter increased to $5, then Dusty could buy a maximum of ________ loaves of bread or a maximum of ________ jars of peanut butter.

A)20; 5
B)5; 20
C)30; 6
D)6; 30

Question 48

Refer to the accompanying figure. The marginal utility of the 5?? apple is:  
$$\begin{array} { | c | c | } \hline \text { Number of Apples } & \begin{array} { c } \text { Tatal } \\\text { Utility }\end{array} \\\hline 1 & 20\\\hline 2 & 35 \\\hline 3 & 45 \\\hline 4 & 50 \\\hline 5 & 45 \\\hline\end{array}$$

A)-5.
B)0.
C)5.
D)45.

Question 49

Assume that Dusty has $30 in income, the price of a loaf of bread is $1.50, and the price of a jar of peanut butter is $3. Suppose that at the original income of $30, the price of a loaf of bread increased to $3 and the price of a jar of peanut butter decreased to $2. Dusty can buy a maximum of ________ loaves of bread or a maximum of ________ jars of peanut butter.

A)10; 15
B)15; 10
C)20; 15
D)15; 20

Question 50

Alex wants to maximize his utility. At his current level of consumption, Alex's marginal utility from an additional cup of coffee is 15 utils, and his marginal utility from an additional can of soda is 11 utils. If the price of a cup of coffee is $3 and the price of a can of soda is $2, Alex should:

A)reallocate his spending away from coffee and towards soda.
B)reallocate his spending away from soda and towards coffee.
C)not change his consumption of either coffee or soda.
D)decrease his spending on both coffee and soda.

Question 51

Refer to the accompanying figure. For Jeff, the consumption of movies reflects the law of:

A)demand.
B)diminishing marginal utility.
C)total utility maximization.
D)marginal utility maximization.

Question 52

If Terry's total utility is maximized when he owns 10 pairs of shoes, then Terry's total utility from owning 7 pairs of shoes is ________ Terry's total utility from owning 8 pairs.

A)greater than
B)equal to
C)less than
D)less than or equal to

Question 53

Joaquin's marginal utility from an additional slice of pumpkin pie is 4 utils and his marginal utility from an additional slice of pecan pie is 6 utils. If a slice of pumpkin pie costs $2.50, and a slice of pecan pie costs $3.00, then Joaquin:

A)should reallocate his spending towards pumpkin pie and away from pecan pie.
B)should reallocate his spending towards pecan pie and away from pumpkin pie.
C)is maximizing his utility.
D)should spend more on pumpkin pie and more pecan pie.

Question 54

Refer to the accompanying table. The marginal utility of consuming the 2?? apple is: $$\begin{array} { | c | c | } \hline \text { Number of Apples } & \begin{array} { c } \text { Tatal } \\\text { Utility }\end{array} \\\hline 1 &20 \\\hline 2 & 35 \\\hline 3 & 45 \\\hline 4 & 50 \\\hline 5 & 45 \\\hline\end{array}$$

A)35.
B)10.
C)15.
D)20.

Question 55

Assume that Dusty has $30 in income, the price of a loaf of bread is $1.50, and the price of a jar of peanut butter is $3. If Dusty's income rises to $45, Dusty can now buy a maximum of ________ loaves of bread or a maximum of ________ jars of peanut butter.

A)5; 25
B)10; 40
C)15; 30
D)30; 15

Question 56

Refer to the accompanying table. The marginal utility of the 4?? dinner out per week is:  
$\begin{array}{|c|c|c|}\begin{array}{c}\text { Number of Dinners } \\\text { Out Per Week }\end{array} & \text { Total Utility } & \text { Marginal Utility } \\\hline 1 & 100 \\\hline 2 & & 75\\\hline 3 & 235 & \\\hline 4 & 250 & \\\hline\end{array}$

A)75.
B)60.
C)250.
D)15.

Question 57

The tendency for marginal utility to decline as consumption increases beyond some point is called:

A)the law of demand.
B)the law of diminishing marginal utility.
C)the rational spending rule.
D)utility maximization.

Question 58

Refer to the accompanying figure. As Jeff watches more movies, his marginal utility:

A)gets larger
B)gets smaller
C)does not change
D)gets close to one

Question 59

Refer to the accompanying table. Total utility ________ as additional apples are consumed, but marginal utility ________ with each additional apple consumed. $$\begin{array} { | c | c | } \hline \text { Number of Apples } & \begin{array} { c } \text { Tatal } \\\text { Utility }\end{array} \\\hline 1 &20 \\\hline 2 & 35 \\\hline 3 & 45 \\\hline 4 & 50 \\\hline 5 & 45 \\\hline\end{array}$$

A)first decreases then increases; decreases
B)first increases then decreases; decreases
C)first decreases then increases; increases
D)first increases then decreases; increases

Question 60

If the marginal utility of the 3ʳᵈ cup of coffee is 23 and the marginal utility of the 4ᵗʰ cup is 15, then:

A)it is optimal for the consumer to have 3 cups of coffee.
B)the price of a cup of coffee must be relatively low.
C)it is optimal for the consumer to have 4 cups of coffee.
D)there is evidence of diminishing marginal utility.

Question 61

The ________ combination of goods is the combination that yields the highest total utility given a consumer's income.

A)affordable
B)economical
C)utility satiating
D)optimal

Question 62

Suppose that Cathy spends all of her income on 20 units of good X and 25 units of good Y. Cathy's marginal utility from the 20ᵗʰ unit of good X is 9 utils, and her marginal utility from the 25ᵗʰ unit of good Y is 19 utils. If the price of good X is $0.50 per unit and the price of good Y is $1.00 per unit, then to comply with the rational spending rule, Cathy should:

A)purchase more than 20 units of good X and less than 25 units of Y.
B)purchase less than 20 units of good X and more than 25 units of good Y.
C)purchase more than 20 units of good X and more than 25 units of good Y.
D)continue to purchase 20 units of good X and 25 units of good Y.

Question 63

Jamie's marginal utility from muffins and from doughnuts (in utils)is shown in the accompanying table. Jamie spends a total of $8 on muffins and/or doughnuts every morning. The price of each muffin is $2 and the price of each doughnut is $1. $$\begin{array} { | c | r | r | r | } \hline \begin{array} { c } \text { Mufins } \\\text { Per Day }\end{array} & \begin{array} { c } \text { Marginnl Utility } \\\text { Per Muftin }\end{array} & \begin{array} { c } \text { Deughnuts } \\\text { Per Day }\end{array} & \begin{array} { c } \text { Marginal Utility } \\\text { Per Deughnut }\end{array} \\\hline 1 & 40 & 2 & 20 \\\hline 2 & 30 & 4 & 15 \\\hline 3 & 20 & 5 & 10 \\\hline\end{array}$$ If Jamie consumes 3 muffins a day, then what is her marginal utility per dollar spent on the third muffin?

A)10
B)20
C)30
D)40

Question 64

Jamie's marginal utility from muffins and from doughnuts (in utils)is shown in the accompanying table. Jamie spends a total of $8 on muffins and/or doughnuts every morning. The price of each muffin is $2 and the price of each doughnut is $1. $$\begin{array} { | c | r | r | r | } \hline \begin{array} { c } \text { Mufins } \\\text { Per Day }\end{array} & \begin{array} { c } \text { Marginnl Utility } \\\text { Per Muftin }\end{array} & \begin{array} { c } \text { Deughnuts } \\\text { Per Day }\end{array} & \begin{array} { c } \text { Marginal Utility } \\\text { Per Deughnut }\end{array} \\\hline 1 & 40 & 2 & 20 \\\hline 2 & 30 & 4 & 15 \\\hline 3 & 20 & 5 & 10 \\\hline\end{array}$$  
If Jamie consumes 2 doughnuts a day, then what is her marginal utility per dollar spent on the second doughnut?

A)10
B)15
C)20
D)40

Question 65

Suppose that each week Henry buys 12 peaches and 3 apples at his local farmer's market. Both kinds of fruit cost $1 each. From this we can infer that:

A)Henry is not maximizing his utility.
B)if Henry is maximizing his utility, then his marginal utility from the 12ᵗʰ peach he buys must be greater than his marginal utility from the 3ʳᵈ apple he buys.
C)if Henry is maximizing his utility, then his marginal utility from the 12ᵗʰ peach he buys must equal his marginal utility from the 3ʳᵈ apple he buys.
D)for Henry the law of diminishing marginal utility does not apply to peaches.

Question 66

At her current level of consumption, Jess gets half as much marginal utility from an additional bagel as from an additional muffin. If the price of muffin is $2 each, then Jess is maximizing her utility if the price of a bagel is:

A)$1.00
B)$1.50
C)$2.00
D)$4.00

Question 67

Jamie's marginal utility from muffins and from doughnuts (in utils)is shown in the accompanying table. Jamie spends a total of $8 on muffins and/or doughnuts every morning. The price of each muffin is $2 and the price of each doughnut is $1. $$\begin{array} { | c | r | r | r | } \hline \begin{array} { c } \text { Mufins } \\\text { Per Day }\end{array} & \begin{array} { c } \text { Marginnl Utility } \\\text { Per Muftin }\end{array} & \begin{array} { c } \text { Deughnuts } \\\text { Per Day }\end{array} & \begin{array} { c } \text { Marginal Utility } \\\text { Per Deughnut }\end{array} \\\hline 1 & 40 & 2 & 20 \\\hline 2 & 30 & 4 & 15 \\\hline 3 & 20 & 5 & 10 \\\hline\end{array}$$ What is Jamie's optimal combination of muffins and doughnuts each day?

A)1 muffin, 6 doughnuts
B)2 muffins, 4 doughnuts
C)3 muffins, 2 doughnuts
D)4 muffins, zero doughnuts

Question 68

At his current level of consumption, Cameron gets 3 times more marginal utility from an additional game of pinball than from an additional game of ping pong. If the price of a ping pong game is $0.50, then he is maximizing utility if the price of a pinball game is:

A)$1.00
B)$1.50
C)$2.00
D)$3.00

Question 69

Suppose the price of an apple is $0.75, and the price of a banana is $0.50. If Hugh is maximizing his utility, and his marginal utility from consuming an apple is 24 utils, then his marginal utility from consuming a banana must be:

A)12 utils.
B)16 utils.
C)32 utils.
D)36 utils.

Question 70

Casey earns $150 a week and consumes only fish and shrimp. The price of fish is $3 a pound and the price of shrimp is $5 a pound. If Casey's income rises to $210, he could buy a maximum of ________ pounds of fish or a maximum of ________ pounds of shrimp.

A)30; 24
B)24; 30
C)70; 42
D)42; 70

Question 71

Taylor's marginal utility from watching movies and from eating out (in utils)is shown in the accompanying table. Taylor spends exactly $100 every month on these two forms of entertainment; the price of each movie is $10 and the price of each dinner is $20. $$\begin{array} { | c | r | c | c | } \hline \begin{array} { c } \text { Mavies } \\\text { Per Manth }\end{array} & \begin{array} { c } \text { Mar ginal Utility } \\\text { Per Movie }\end{array} & \begin{array} { c } \text { Dingers Out } \\\text { Per Month }\end{array} & \begin{array} { c } \text { Marginal Utility } \\\text { Per Dinner }\end{array} \\\hline 1 & 60 & 1& 150 \\\hline 2 & 50 & 2 & 140 \\\hline 3 & 20 & 3 & 120 \\\hline 4 & 5 & 4 & 100 \\\hline\end{array}$$  
If Taylor watches 2 movies a month, Taylor will eat out ________ times per month, and have marginal utility per dollar of ________ from movies and a marginal utility per dollar of ________ from eating out.

A)3; 5; 6
B)2; 5; 7
C)4; 5; 5
D)4; 4; 6

Question 72

Casey earns $150 a week and consumes only fish and shrimp. The price of fish is $3 a pound and the price of shrimp is $5 a pound. Suppose the price of fish decreased to $1.50 a pound, and the price of shrimp remains $5 a pound. At Casey's original income of $150 per week, Casey can now buy a maximum of ________ pounds fish or a maximum of ________ pounds shrimp.

A)10; 30
B)30; 50
C)30; 100
D)100; 30

Question 73

Suppose that Coke and Sprite each sell for $2 a can. Each month Joe buys 6 cans of Sprite and 30 cans of Coke. From this we can infer that:

A)Joe is buying too many cans of Sprite.
B)Joe is buying too many cans of Coke.
C)Joe is maximizing his utility if his marginal utility from the 6ᵗʰ can of Sprite he buys is less than his marginal utility from the 30ᵗʰ can of Coke he buys.
D)Joe is maximizing his utility if his marginal utility from the 6ᵗʰ can of Sprite he buys is equal to his marginal utility from the 30ᵗʰ can of Coke he buys.

Question 74

Taylor's marginal utility from watching movies and from eating out (in utils)is shown in the accompanying table. Taylor spends exactly $100 every month on these two forms of entertainment; the price of each movie is $10 and the price of each dinner is $20. $$\begin{array} { | c | r | c | c | } \hline \begin{array} { c } \text { Mavies } \\\text { Per Manth }\end{array} & \begin{array} { c } \text { Mar ginal Utility } \\\text { Per Movie }\end{array} & \begin{array} { c } \text { Dingers Out } \\\text { Per Month }\end{array} & \begin{array} { c } \text { Marginal Utility } \\\text { Per Dinner }\end{array} \\\hline 1 & 60 & 1& 150 \\\hline 2 & 50 & 2 & 140 \\\hline 3 & 20 & 3 & 120 \\\hline 4 & 5 & 4 & 100 \\\hline\end{array}$$  
If Taylor eats out 3 times a month, Taylor will watch ________ movies, and have marginal utility per dollar of ________ from eating out and a marginal utility per dollar of ________ from going to the movies.

A)4; 6; 2
B)3; 2; 6
C)4; 6; 1/2
D)3; 4; 4

Question 75

Suppose a cup of tea costs $0.60 and a scone costs $1.20. If Edith spends all of her income on these two goods, and at her current level of consumption, she receives a marginal utility of 6 utils from the last cup of tea she buys and a marginal utility of 24 utils from the last scone she buys, then Edith should:

A)buy more tea and fewer scones.
B)buy less tea and more scones.
C)not change her consumption of tea and scones.
D)buy more tea and more scones.

Question 76

Taylor's marginal utility from watching movies and from eating out (in utils)is shown in the accompanying table. Taylor spends exactly $100 every month on these two forms of entertainment; the price of each movie is $10 and the price of each dinner is $20. $$\begin{array} { | c | r | c | c | } \hline \begin{array} { c } \text { Mavies } \\\text { Per Manth }\end{array} & \begin{array} { c } \text { Mar ginal Utility } \\\text { Per Movie }\end{array} & \begin{array} { c } \text { Dingers Out } \\\text { Per Month }\end{array} & \begin{array} { c } \text { Marginal Utility } \\\text { Per Dinner }\end{array} \\\hline 1 & 60 & 1& 150 \\\hline 2 & 50 & 2 & 140 \\\hline 3 & 20 & 3 & 120 \\\hline 4 & 5 & 4 & 100 \\\hline\end{array}$$  
Taylor's optimal combination of movies and eating out is:

A)3 movies and 3 dinners.
B)4 movies and 3 dinners.
C)3 movies and 4 dinners.
D)2 movies and 4 dinners.

Question 77

Suppose that at Miles's current level of consumption, his marginal utility from a pizza is 10 utils, and his marginal utility from a pint of ice cream is 16 utils. If the price of a pizza is $8, and the price of a pint of ice cream is $5, is Miles maximizing his utility?

A)No. He should shift his spending away from ice cream and towards frozen pizza.
B)No. He should buy less frozen pizza and less ice cream.
C)No. He should shift his spending away from frozen pizza and towards ice cream.
D)Yes. He should not change his spending on frozen pizza and ice cream.

Question 78

Angela is currently playing five games of pool and bowling three games. At this level of consumption, her marginal utility from a game of pool is 10 and her marginal utility from bowling a game is 6. If both pool and bowling cost $1 a game, Angela should:

A)bowl more and play pool less.
B)just go home.
C)bowl only.
D)bowl less and play pool more.

Question 79

At his current level of consumption, Evan gets twice as much marginal utility from an additional bottle of water as that from an additional bottle of soda. If the price of soda is $1.00 per bottle, then Evan is maximizing utility if the price of a bottle of water is:

A)$1.00
B)$1.50
C)$2.00
D)$0.50

Question 80

Suppose that Fiona spends all of her income on 10 units of good X and 14 units of good Y. Fiona's marginal utility from the 10ᵗʰ unit of good X is 24 utils, and her marginal utility from the 14ᵗʰ unit of good Y is 20 utils. If the price of good X is $8 per unit and the price of good Y is $5 per unit, then to comply with the rational spending rule, Fiona should:

A)purchase more than 10 units of good X and less than 14 units of Y.
B)purchase less than 10 units of good X and more than 14 units of good Y.
C)purchase more than 10 units of good X and more than 14 units of good Y.
D)continue to purchase 10 units of good X and 14 units of good Y.