Question 1

Explain how consumers maximize their utility (joy) within the bounds of their income.
-Is it possible to consume goods until their marginal utility goes to zero? Why or why not?

Accepted Answer

The answer of Explain how consumers maximize their utility (joy)...

Question 2

Explain the assumptions made about consumers and households used to build utility theory.
-What happens to total utility even if there is diminishing marginal utility? Even if there is diminishing marginal utility, why is it assumed that people prefer more rather than less?

Accepted Answer

The answer of Explain the assumptions made about consumers and...

Question 3

Whats defention of terms:
-rationality

Accepted Answer

The answer of Whats defention of terms:
-rationality...

Question 4

What does the assumption of diminishing marginal utility mean?

Accepted Answer

A)   eventually additional units consumed will lead to a decline in total utility.
B)   utility cannot be precisely measured but consumers can produce a ranking of consumption choices.
C)   as more units are consumed each additional unit will provide less and less additional utility.
D)   an increase in units of labor will leads to less and less additional output.E) A) and B)
F) A) and C)

Question 5

Whats defention of terms:
-negative marginal utility

Accepted Answer

The answer of Whats defention of terms:
-negative marginal utility...

Question 6

Discuss the criticisms of the assumptions of neoclassical consumer theory.
-Consumer sovereignty says that households ultimately decide what businesses produce. How does advertising compromise the notion that households control what businesses do?

Accepted Answer

The answer of Discuss the criticisms of the assumptions of...

Question 7

Whats defention of terms:
-marginal utility

Accepted Answer

The answer of Whats defention of terms:
-marginal utility...

Question 8

Whats defention of terms:
-total utility

Accepted Answer

The answer of Whats defention of terms:
-total utility...

Question 9

When neoclassical economists assume that individuals are rational, they mean that people

Accepted Answer

A)   rarely show emotion.
B)   are generally unselfish and self-sacrificing.
C)   make purposeful choices based on their own self-interest.
D)   make impulsive decisions based on what feels good at the time.E) C) and D)
F) A) and B)

Question 10

Whats defention of terms:
-utility

Accepted Answer

The answer of Whats defention of terms:
-utility...

Question 11

Explain the assumptions made about consumers and households used to build utility theory.
-List the assumptions that are used to build the traditional model of consumer demand.

Accepted Answer

The answer of Explain the assumptions made about consumers and...

Question 12

Understand and demonstrate how the demand curve is derived.
-Can consumers dictate the prices they pay for products at the store? What can consumers do if the price of a product rises and their income is fixed? What role does the availability of substitutes play here?

Accepted Answer

The answer of Understand and demonstrate how the demand curve...

Question 13

Understand and demonstrate how the demand curve is derived.
-Explain how consumers reacting to changes in prices and attempting to keep at a utility-maximizing level of consumption leads to the relationship between price and quantity demanded.

Accepted Answer

The answer of Understand and demonstrate how the demand curve...

Question 14

Whats defention of terms:
-conspicuous consumption

Accepted Answer

The answer of Whats defention of terms:
-conspicuous consumption...

Question 15

Whats defention of terms:
-ordinal utility

Accepted Answer

The answer of Whats defention of terms:
-ordinal utility...

Question 16

Discuss the criticisms of the assumptions of neoclassical consumer theory.
-What is the difference between demand and effective demand or the ability to buy a good or service?

Accepted Answer

The answer of Discuss the criticisms of the assumptions of...

Question 17

Explain the conditions under which utility is maximized.
-Fill in the table above. Is the principle of diminishing marginal utility operative in this case? How do you know?

Accepted Answer

The answer of Explain the conditions under which utility is...

Question 18

Discuss the criticisms of the assumptions of neoclassical consumer theory.
-What factors might affect your preferences for different goods or services?

Accepted Answer

The answer of Discuss the criticisms of the assumptions of...

Question 19

Table 28.1a 	ext { Table 28.1a } Table 28.1a  
  Apples  Bread  Cake 11 units of utility 22 units of utility 33 units of utility \begin{array}{|l|l|l|}\hline 	ext { Apples } & 	ext { Bread } & 	ext { Cake } \\hline 11 	ext { units of utility } & 22 	ext { units of utility } & 33 	ext { units of utility }\\hline\end{array} Apples 11 units of utility ​ Bread 22 units of utility ​ Cake 33 units of utility ​​

-Tables 28.1a provides information on Sam's current consumption of apples, bread and cake. Sam is currently maximizing utility it

Accepted Answer

A)   the price of apples is $1, bread is $2 and cake is $3
B)   the prices of apples, bread and cake are all $1.
C)   the price of apples is $3, bread is $2, and cake is $1
D)   all items are $11 each E) B) and C)
F) A) and C)

Exam 28: Consumption Theory: Demand

Whats defention of terms: -ordinal utility

Correct Answer
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Whats defention of terms: -total utility

Correct Answer
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Discuss the criticisms of the assumptions of neoclassical consumer theory. -What factors might affect your preferences for different goods or services?

Correct Answer
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Explain the conditions under which utility is maximized. -Fill in the table above. Is the principle of diminishing marginal utility operative in this case? How do you know?

Correct Answer
verified

Discuss the criticisms of the assumptions of neoclassical consumer theory. -Consumer sovereignty says that households ultimately decide what businesses produce. How does advertising compromise the notion that households control what businesses do?

Correct Answer
verified

Understand and demonstrate how the demand curve is derived. -Explain how consumers reacting to changes in prices and attempting to keep at a utility-maximizing level of consumption leads to the relationship between price and quantity demanded.

Correct Answer
verified

When neoclassical economists assume that individuals are rational, they mean that people

Correct Answer
verified

Whats defention of terms: -rationality

Correct Answer
verified

Explain how consumers maximize their utility (joy) within the bounds of their income. -Is it possible to consume goods until their marginal utility goes to zero? Why or why not?

Correct Answer
verified

Whats defention of terms: -negative marginal utility

Correct Answer
verified

Whats defention of terms: -marginal utility

Correct Answer
verified

Explain the assumptions made about consumers and households used to build utility theory. -What happens to total utility even if there is diminishing marginal utility? Even if there is diminishing marginal utility, why is it assumed that people prefer more rather than less?

Correct Answer
verified

Correct Answer
verified

Whats defention of terms: -conspicuous consumption

Correct Answer
verified

Understand and demonstrate how the demand curve is derived. -Can consumers dictate the prices they pay for products at the store? What can consumers do if the price of a product rises and their income is fixed? What role does the availability of substitutes play here?

Correct Answer
verified

Discuss the criticisms of the assumptions of neoclassical consumer theory. -What is the difference between demand and effective demand or the ability to buy a good or service?

Correct Answer
verified

What does the assumption of diminishing marginal utility mean?

Correct Answer
verified

Whats defention of terms: -utility

Correct Answer
verified

Explain the assumptions made about consumers and households used to build utility theory. -List the assumptions that are used to build the traditional model of consumer demand.

Correct Answer
verified

Exam 28: Consumption Theory: Demand

Whats defention of terms: -ordinal utility

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Whats defention of terms: -total utility

Correct AnswerverifiedShow Answer

Discuss the criticisms of the assumptions of neoclassical consumer theory. -What factors might affect your preferences for different goods or services?

Correct AnswerverifiedShow Answer

Explain the conditions under which utility is maximized. -Fill in the table above. Is the principle of diminishing marginal utility operative in this case? How do you know?

Correct AnswerverifiedShow Answer

Discuss the criticisms of the assumptions of neoclassical consumer theory. -Consumer sovereignty says that households ultimately decide what businesses produce. How does advertising compromise the notion that households control what businesses do?

Correct AnswerverifiedShow Answer

Understand and demonstrate how the demand curve is derived. -Explain how consumers reacting to changes in prices and attempting to keep at a utility-maximizing level of consumption leads to the relationship between price and quantity demanded.

Correct AnswerverifiedShow Answer

When neoclassical economists assume that individuals are rational, they mean that people

Correct AnswerverifiedShow Answer

Whats defention of terms: -rationality

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Explain how consumers maximize their utility (joy) within the bounds of their income. -Is it possible to consume goods until their marginal utility goes to zero? Why or why not?

Correct AnswerverifiedShow Answer

Whats defention of terms: -negative marginal utility

Correct AnswerverifiedShow Answer

Whats defention of terms: -marginal utility

Correct AnswerverifiedShow Answer

Explain the assumptions made about consumers and households used to build utility theory. -What happens to total utility even if there is diminishing marginal utility? Even if there is diminishing marginal utility, why is it assumed that people prefer more rather than less?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Whats defention of terms: -conspicuous consumption

Correct AnswerverifiedShow Answer

Understand and demonstrate how the demand curve is derived. -Can consumers dictate the prices they pay for products at the store? What can consumers do if the price of a product rises and their income is fixed? What role does the availability of substitutes play here?

Correct AnswerverifiedShow Answer

Discuss the criticisms of the assumptions of neoclassical consumer theory. -What is the difference between demand and effective demand or the ability to buy a good or service?

Correct AnswerverifiedShow Answer

What does the assumption of diminishing marginal utility mean?

Correct AnswerverifiedShow Answer

Whats defention of terms: -utility

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Explain the assumptions made about consumers and households used to build utility theory. -List the assumptions that are used to build the traditional model of consumer demand.

Correct AnswerverifiedShow Answer

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