Which of the following is false?
a. We can be sure that people with more income get less marginal utility from their consumption of a good than those with less income.
b. We can be sure that people with less income get less marginal utility from their consumption of a good than those with more income.
c. We can be sure that those who receive greater marginal utility from consumption of a particular unit of an item receive greater total utility from consumption of that item.
d. All of the above are false.
QUESTION 2A firm that was initially a monopsonist, but now has to buy from a competitive resource market will:
a. buy more amount of resources and pay a higher price for these resources.
b. buy the same amount of resources and pay a higher price for these resources.
c. buy less amount of resources and pay a lower price for these resources.
d. buy less amount of resources and pay a higher price for these resources.
e. buy more amount of resources and pay a lower price for these resources.
QUESTION 3Scarcity impels an individual to make choices.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 4Which of the following is true?
a. Total utility is the aggregate level of satisfaction that results from consumption of a given number of goods and services.
b. Marginal utility is the additional satisfaction generated by the last unit of a good that is consumed.
c. Total utility equals marginal utility of the last unit times the number of units consumed.
d. Both a. and b. are true.
QUESTION 5The value of the marginal product is equal to the marginal revenue product under perfect competition in the product market because:
a. price is equal to average revenue.
b. price is equal to average cost.
c. marginal revenue is equal to marginal cost.
d. price is equal to marginal revenue.
e. average revenue is equal to average cost.
QUESTION 6People are compelled to make a choice because of the lack of time and money to buy everything they want.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 7Colin consumes both corned beef sandwiches and steak sandwiches. Corned beef is priced at 5.00 per sandwich and steak sandwiches are priced at 8.00 . Which of the following marginal utility pairs is consistent with Colin's consumer equilibrium at these prices?
a. MU of corned beef sandwich = 1; MU of steak sandwich = 1
b. MU of corned beef sandwich = 1; MU of steak sandwich = 1.6
c. MU of corned beef sandwich = 1.6; MU of steak sandwich = 1
d. MU of corned beef sandwich = 1; MU of steak sandwich = 5
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