Question :
42) If Raul’s marginal utility per dollar from bread 25 : 1241114
42) If Raul’s marginal utility per dollar from bread is 25 and the marginal utility per dollar from butter is 30,
A) Raul should purchase more butter and less bread to increase his total utility.
B) Raul’s marginal utility from butter will fall if he buys more butter.
C) Raul’s marginal utility from bread will rise if he buys less bread.
D) Only answers B and C are correct.
E) Answers A, B, and C are correct.
43) Sheryl is maximizing her utility. She notices that her marginal utility from the last package of bubble gum consumed is greater than her marginal utility from the last package of mints consumed. This result means that the
A) price of a package of gum is greater than the price of a package of mints.
B) price of a package of mints is greater than the price of a package of gum.
C) total utility of gum must be falling as more gum is consumed.
D) total utility of mints must be falling as more mints are consumed.
E) More information is needed to determine which, if any, of the above answers is correct.
44) Assume you are in a store looking at a shirt you want. You expect to buy the shirt until you look at the price, then you decide the shirt is not a good buy. How can your decision be viewed in economic terms?
A) The shirt’s marginal utility divided by price was too low compared to other goods.
B) The shirt has zero marginal utility for you.
C) The opportunity cost of the shirt was too low.
D) The shirt’s marginal utility divided by price was too high compared to other goods.
E) None of the above answers is correct.
45) In a month, Samantha consumes the quantity of lobster dinners so that her marginal utility from a lobster dinner is 500 units. The price of a lobster dinner is $25. She also is consuming the quantity of spaghetti dinners so that its marginal utility is 300 units, while its price is $15. Samantha is allocating her entire budget. What should she do to maximize her total utility?
A) consume more lobster dinners and fewer spaghetti dinners
B) consume more spaghetti dinners and fewer lobster dinners
C) consume the current combination of lobster and spaghetti dinners
D) consume fewer lobster dinners and fewer spaghetti dinners
E) Not enough information is given to answer the question.
46) Suppose the price of a pair of jeans is $25 and the price of a T-shirt is $15. The consumer’s budget is entirely allocated. If the marginal utility from a pair of jeans is 100 units and the marginal utility from a T-shirt is 75 units, the consumer is
A) in equilibrium because his or her utility is maximized.
B) not in equilibrium and should purchase fewer jeans and more T-shirts.
C) not in equilibrium and should purchase fewer T-shirts and more jeans.
D) not in equilibrium but should maintain the current level of purchases.
E) not in equilibrium and should purchase more T-shirts and more jeans.
47) Mary is currently buying apples and oranges such that the last unit of apples has 30 units of utility and the last unit of oranges has 40 units of utility. She has allocated her entire budget. If the price of an apple is 10 cents and the price of an orange is 20 cents, to maximize her utility, what should Mary do?
A) buy more apples and fewer oranges
B) buy more oranges and fewer apples
C) continue to buy the same amounts of both goods
D) buy fewer apples and fewer oranges
E) None of the above answers is correct.
48) Suppose that Jen receives 400 units of utility from her last soda and 200 units of utility from her last slice of pizza. What can we conclude about Jen’s choices if the price of a soda is $1 and the price of a slice of pizza is $2?
A) Jen is maximizing utility because she buys more of the good providing the most utility.
B) Jen should buy more soda to maximize her utility.
C) Jen should buy more pizza to maximize her utility.
D) Jen needs to buy less soda and less pizza to maximize her utility.
E) None of the above answers is correct.
49) The price of coffee increases because of low crop yields. If the consumer’s utility schedule for coffee remains constant, we can predict that coffee consumption
A) will increase.
B) will decrease.
C) will stay the same.
D) will increase if the marginal utility of coffee diminishes and will decrease if the marginal utility of coffee increases.
E) might change, but we need more information to determine if it increased, decreased, or did not change.
50) The consumption of bottled water increased dramatically during the 1990s. If consumers’ utility schedules for water remained constant over this time period, in order for consumers to stay in equilibrium, the price of bottled water must have
A) risen because marginal utility increased since people consumed more bottled water.
B) fallen.
C) remained constant because the marginal utility schedule did not change.
D) risen because the supply of water must have increased.
E) We don’t have enough information to say what happened to the price.
