Deck 23: Extension C: Review

Question 1

Simon spends $150 per month on DVD movie rentals and music CDs. The price of a movie rental is $3 and a CD is $15. If Simon buys 10 CDs per month, how many DVDs will he rent?

A) 0
B) 1
C) 2
D) It is impossible to determine how many DVDs Simon will rent without more information.

Answer 1

0

Question 2

-Rick's income is $54 a week and he spends all of it on CDs and sandwiches. The price of a CD is $18 and the price of a sandwich is $3. The figure above illustrates Rick's preferences. What is Rick's best affordable combination of CDs and sandwiches?

A) 2 CDs and 8 sandwiches a week
B) 3 CDs a week and no sandwiches
C) 1 CD and 12 sandwiches a week
D) 3 CDs and 6 sandwiches a week

Answer 2

1 CD and 12 sandwiches a week

Question 3

-Rick's income is $54 a week and he spends all of it on CDs and sandwiches. The price of a CD is $18 and the price of a sandwich is $3. The figure above illustrates Rick's preferences. If the price of a CD falls to $6, Rick's consumption of sandwiches will

A) increase by 4 sandwiches per week.
B) increase by 2 sandwiches per week.
C) not change.
D) decrease by 2 sandwiches per week.

Answer 3

decrease by 2 sandwiches per week.

Question 4

-In the table above, Ron's marginal utility from the 4th chocolate frog is

A) 20.
B) 30.
C) 115.
D) 125.

Question 5

-In the table above, Ron's marginal utility is

A) constant.
B) diminishing.
C) increasing.
D) negative.

Question 6

-Rick's income is $54 a week and he spends all of it on CDs and sandwiches. The price of a CD is $18 and the price of a sandwich is $3. The figure above illustrates Rick's preferences. If the price of a CD falls to $6, Rick's consumption of CDs will increase by

A) 1 CD per week.
B) 2 CDs per week.
C) 3 CDs per week.
D) 4 CDs per week.

Question 7

CDs Computer games

-Jason's budget for CDs and computer games is $210. His marginal utility from these goods is shown in the table above. If the price of a CD is $15 and the price of a computer game is $30, which of the following combinations maximizes Jason's utility?

A) 4 CDs and 5 computer games
B) 6 CDs and 4 computer games
C) 2 CDs and 6 computer games
D) 5 CDs and 5 computer games

Question 8

As Matt's consumption of root beer increases, his

A) marginal utility from root beer increases.
B) marginal utility from root beer decreases.
C) total utility from root beer decreases.
D) both total and marginal utility from root beer increase.

Question 9

Dudley plans to spend £210 on ice cream and chocolate bars. The price of ice cream is £3 per gallon and a chocolate bar £1.50. If Dudley buys 50 gallons of ice cream, how many chocolate bars is he able to buy?

A) 50
B) 40
C) 70
D) 140

Question 10

-Rick's income is $54 a week and he spends all of it on CDs and sandwiches. The price of a CD is $6 and the price of a sandwich is $3. The figure above illustrates Rick's preferences. At Rick's best affordable point, the marginal rate of substitution is

A) 0.5 sandwiches per CD.
B) 1 sandwich per CD.
C) 1.5 sandwiches per CD.
D) 2 sandwiches per CD.

Question 11

-Rick's income is $54 a week and he spends all of it on CDs and sandwiches. The price of a CD is $18 and the price of a sandwich is $3. The figure above illustrates Rick's preferences. At Rick's best affordable point, the marginal rate of substitution is

A) 6 sandwiches per CD.
B) 3 sandwiches per CD.
C) 2 sandwiches per CD.
D) 1/6 of a sandwich per CD.

Question 12

-Rick's preferences are shown in the figure above. Which of the following combinations of goods does Rick prefer the most?

A) 2 CDs and 18 sandwiches
B) 5 CDs and 10 sandwiches
C) 8 CDs and 5 sandwiches
D) 9 CDs and 4 sandwiches

Question 13

-Rick's income is $54 a week and he spends all of it on CDs and sandwiches. The price of a CD is $6 and the price of a sandwich is $3. The figure above illustrates Rick's preferences. What is Rick's best affordable combination of CDs and sandwiches?

A) 3 CDs and 12 sandwiches a week
B) 4 CDs and 10 sandwiches a week
C) 6 CDs and 12 sandwiches a week
D) 8 CD and 2 sandwiches a week

Question 14

Basil spends all his income on apples and bananas. Apples cost $2.50 per pound and bananas cost $1.50 per pound. The marginal utility is 20 for the last pound of apples purchased and 10 for the last pound of bananas. To maximize his utility, Basil should buy

A) more apples and fewer bananas.
B) more bananas and fewer apples.
C) the present combination of goods.
D) only apples.