Which of the following sayings describes the concept of diminishing marginal utility?
a. time is money
b. penny wise and pound foolish
c. absence makes the heart grow fonder
d. a penny saved is a penny earned
e. a fool and his money are soon parted
QUESTION 2Which of the following illustrates the law of diminishing marginal utility?
a. The marginal utility of Diane's second Coke is greater than the marginal utility of her third pretzel, other things constant.
b. The marginal utility of Diane's second Coke is greater than the marginal utility of Ken's third pretzel, other things constant.
c. The marginal utility of Diane's second Coke is greater than the marginal utility of her third Coke, other things constant.
d. The total utility of one Coke is greater than the total utility of two Cokes, other things constant.
e. The marginal utility of Diane's second Coke is greater than the marginal utility of Ken's third Coke, other things constant.
QUESTION 3Diminishing marginal utility means that
a. as you consume more of a good, other things constant, the total satisfaction you obtain from consuming this good tends to fall
b. as you hire more labor, other things constant, the total amount produced begins to fall
c. as you hire more labor, other things constant, the marginal product begins to fall
d. as you consume more of a good, other things constant, the additional satisfaction you obtain from each additional unit of the good tends to fall
e. as you consume more of a good, other things constant, the extra satisfaction you obtain from each extra good becomes negative
QUESTION 4The marginal utility received from each additional unit of a good consumed declines, other things constant. This is a statement of the law of
a. increasing marginal returns
b. marginal rate of substitution
c. supply
d. diminishing marginal utility
e. demand
QUESTION 5The law of diminishing marginal utility states that
a. total utility falls as more of a good is consumed, other things constant
b. total utility falls as marginal utility falls, other things constant
c. marginal utility falls as total utility increases, other things constant
d. marginal utility falls as more of a good is consumed, other things constant
e. marginal utility falls as less of a good is consumed, other things constant
QUESTION 6Marginal utility is defined as the
a. average amount of satisfaction gained from consuming a product
b. total amount of satisfaction gained from consuming a product
c. additional satisfaction gained from consuming one more unit of a product
d. total amount of satisfaction gained from consuming a product divided by the number of units consumed
e. total amount of satisfaction gained from consuming a product times the number of units consumed
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