If John's marginal benefit derived from the consumption of another candy bar is greater than the price of the candy bar:
a. John will not purchase any more candy bars.
b. John will increase his total satisfaction by purchasing the candy bar.
c. the opportunity cost of the candy bar is lower than the price.
d. John will decrease his total utility if he purchases the candy bar.
QUESTION 2For a monopolist with a downward-sloping demand curve,
a. the coefficient of price elasticity of demand is infinite.
b. the coefficient of price elasticity of demand is zero.
c. as price increases, marginal revenue decreases.
d. as price decreases, marginal revenue decreases.
e. when the price is equal to zero, marginal revenue is equal to zero.
QUESTION 3In the theory of consumer choice, when a person is choosing which good or service to consume, how does he or she select the units of good or service to consume?
a. The person selects the good or service based on need.
b. The person selects the units of a good or service that generates the greatest marginal utility. This process continues until there budget is spent.
c. The person selects the units of a good or service that generates the greatest marginal utility per dollar spent. This process continues until the person's budget is spent.
d. The person randomly selects what they buy until the budget is spent.
QUESTION 4At any point where a monopolist's marginal revenue is positive, the downward-sloping straight-line demand curve is:
a. perfectly elastic.
b. elastic, but not perfectly elastic.
c. unit elastic.
d. inelastic.
QUESTION 5In the consumer choice problem, consumers are confronted with which of the following?
a. A set of different consumer goods and services to choose from.
b. A set of prices for those goods and services.
c. A finite budget that constrains the quantity of goods and services that consumers can buy.
d. Preferences or utility associated with consuming different quantities of each of the different goods and services.
e. All of the above answers are correct.
QUESTION 6When marginal revenue is zero for a monopolist facing a downward-sloping straight-line demand curve, the price elasticity of demand is:
a. greater than 1.
b. equal to 1.
c. less than 2.
d. equal to 0.
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