Chapter 05 Test Bank Key
1. Sociopsychiatric explanations of consumer behavior include the
A. Desire for ego and status.
2. Economic explanations of consumer behavior take into consideration
3. If an individual demands a good, it means that he or she
4. Which of the following is not a determinant of demand?
5. As compared to sociologists and psychologists, economists accept consumer tastes as given and instead focus
on
6. Graphically, as a consumer buys more of a good, the marginal utility line will
7. When economists refer to the determinants of demand, they are referring to factors that when changed,
8. Utility refers to the
9. Marginal utility is
A. The sum of the total utility of consuming a certain amount of a good.
10. Total utility is
11. If a product has a high marginal utility, then
12. The marginal utility for a good is computed as
A. Total utility divided by quantity.
13. The additional pleasure or satisfaction from a good declines as more of it is consumed in a given period. This
is the definition of the
14. The law of diminishing marginal utility suggests that
A. People are willing to buy additional quantities of a good only if its price falls.
15.
Refer to Table 19.1. What is Josh’s total utility from consuming the third slice of pizza?
16.
Refer to Table 19.1. The marginal utility Josh enjoys from the fourth slice of pizza is
17.
Refer to Table 19.1. For Josh, diminishing marginal utility begins
18. The law of diminishing marginal utility states that
A. The total utility of consuming the next unit of a good falls.
19. As more satisfaction is achieved from consuming a good with diminishing marginal utility, then total utility
A. Increases at a decreasing rate.
20. Jose goes to an all-you-can-eat buffet at a Chinese restaurant and consumes three plates of food. He does not
go back for a fourth plate of food because
21. If marginal utility is negative, then
A. Total utility will increase with additional consumption.
22. Total utility is maximized when
23. Most goods can yield
24. If a good had a zero price (i.e., the good was free), a rational person would consume
25. Which of the following is not held constant when considering a shift in the demand for pizza?
26. According to the law of demand, ceteris paribus,
A. The quantity demanded increases at lower prices.
27. The four determinants of demand that are held constant when we consider a movement along a demand
curve include all of the following except
28. The market demand for a product is
29. The law of diminishing marginal utility gives us a deeper understanding of the downward-sloping demand curve
because
A. Consumers are willing to pay a higher price for a greater quantity.
30. The _________ of the demand curve corresponds to the idea that the marginal utility for the first few goods is
_____________________.
31. Consumer surplus measures
32. Rosa is willing to pay $200 for the iPhone, but the actual price is $400. This means
33. The benefit that consumers get when they buy goods at the equilibrium price but were willing to pay more
is called
34. The total consumer surplus is shown on a graph as
35. Which of the following statements best captures the concept of consumer surplus?
36. Evaluating a supply and a demand curve independently, if the equilibrium price rises,
37. The ___________ surplus will rise if the price of the good ________.
38.
See Figure 19.1. Lu’s consumer surplus is equal to
39.
Refer to Figure 19.1. The total consumer surplus in this market is equal to
40.
Refer to Figure 19.1. Ben’s consumer surplus is equal to
41. Price discrimination occurs when
A. Minorities pay a higher price for a product than everyone else.
42. Price discrimination is ________ in the United States and ________ practiced.
44. Which of these examples is an example of price discrimination?
45. Sellers can gain profits from price discrimination because
46. Car dealers can easily price discriminate
because A. Buyers do not know the car’s price.
47. Price discrimination works best when
48. Airline companies engage in price discrimination by
49. Price discrimination
50. Which industry here is unlikely to exhibit price discrimination?
A. Airlines.
51. Assume Amanda always maximizes her total utility given her budget constraint. Every morning for breakfast
she has two eggs and three sausages. If the marginal utility of the last egg is 10 utils and the price of eggs is
$1 each, what can we say about the marginal utility of the last sausage if the price of each sausage is $2?
52. Suppose Caesar allocates his entire budget to the purchase of soft drinks and chips. The marginal utility of the
last bottle of soft drink purchased is 12 utils, and each bottle costs $1.20. The marginal utility of the last bag of
chips purchased is 8 utils, and each bag costs $1. In order to maximize his utility, Caesar should
53. Maximum utility is achieved when
54. A consumer maximizes total utility from a given amount of income when the
A. Marginal utility obtained from the last dollar spent on each good is the same.
55.
Complete Table 19.2 below:
In Table 19.2, the marginal utility of the third unit is
56.
Complete Table 19.2 below:
In Table 19.2, the total utility when two units are consumed is
57.
Complete Table 19.2 below:
In Table 19.2, the total utility when four units are consumed is