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Question 1
1.
If marginal utility is declining but still positive, total utility is constant.
Answer True
False
1 points
Question 2
1.
When the ratios of the marginal utility to the price of goods are equal, you are maximizing
utility.
Answer True
False
1 points
Question 3
1.
Consumer surplus occurs when you are able to buy a good at a lower price than you were
willing to pay.
Answer True
False
1 points
Question 4
1.
As discussed in the lectures, the main reason for consumption is for the growth and
maintenance of the life process
Answer True
False
1 points
Question 5
1.
Which of the Following is NOT an assumption of Rational Choice Theory:
Answer

A. Decision making is costless

B. Tastes are given

C. An individual’s choice depends on the choices of others

D. Individuals maximize utility
1 points
Question 6
1.
The Irish Potato Famine example from the lecture is an example of the “Giffen” paradox,
where an increase in price causes a decrease in consumption.
Answer True
False
1 points
Question 7
1.
Heterodox Consumption Theory does not involve consuming
Answer

A. Goods with Instrumental and Ceremonial Attributes

B. Goods with bundles of attributes

C. Goods with others, not just as individuals

D. fixed utility preferences
1 points
Question 8
1.
The total satisfaction one gets from one's consumption of a product is called:
Answer

A. marginal utility.

B. a unit of utility.

C. total utility.

D. minimum utility.
1 points
Question 9
1.
Joe is maximizing utility by consuming 3 colas at $2 each and 4 hot dogs. The last cola
gave him 200 units of utility and the last hot dog gave him 300 units of utility. The price of
each hot dog is:
Answer

A. $3.00.

B. $1.50.

C. $1.00.

D. $0.50.
1 points
Question 10
1.

Refer to the table above. What is the marginal utility of the fourth can of soda?
Answer

A. 44 units of utility.

B. 10 units of utility.

C. 8 units of utility.

D. 2 units of utility.
1 points
Question 11
1.

Refer to the table above. What is the total utility of five cans of soda?
Answer

A. 6

B. 50

C. 36

D. 44
1 points
Question 12
1.
The Sherman Anti-trust Act, passed in 1890, was used to
eak up the Standard Oil Trust
and the US Steel Company.
Answer True
False
1 points
Question 13
1.
A dominant strategy means that one player will always win the game.
Answer True
False
1 points
Question 14
1.
Public regulation of a market is used when which of the following is present
Answer

A. monopoly

B. fixed costs are high

C. elastic demand

D. natural monopoly
1 points
Question 15
1.
Accounting profit and economic profit differ because economic profit fails to take into
account opportunity cost.
Answer True
False
1 points
Question 16
1.
The law of diminishing marginal productivity states that as more units of a variable input
are added holding other inputs constant (ceteris paribus), the additional output obtained
from each new unit of the variable input eventually falls.
Answer True
False
1 points
Question 17
1.
If total cost is 100, total fixed cost is 30, and output is 20, then average variable cost is 3.5.
Answer True
False
1 points
Question 18
1.
Accounting profit is equal to:
Answer

A. total revenue minus implicit costs.

B. total revenue minus explicit measurable costs.

C. total revenue minus implicit and explicit costs.

D. implicit and explicit revenues minus implicit costs.
1 points
Question 19
1.
Rachel left her job as a graphic artist, where she earned $42,000 per year, to open her own
graphic arts firm. Her implicit costs of the new business include:
Answer

A. only the expenses incu
ed for office space, equipment,...