HECON QUIZ

denotes satisfaction. A subjective pleasure that an individual can derive from consuming a good or service.

• Choice

• Utility

• Income

• Economic theory

Each successive incremental improvement in health generates less and less additions to total utility

• law of increasing marginal utility

• indifferent curve

• law of diminishing marginal utility

• budget constraints

Factors to consider in decision making:

• taste and preference

• taste and preferences, income

• none

• income and preferences

- a property of preference that implies a bundle of goods can be ranked as preferred, indifferent or less preferred to one another

• transitivity

• rational preferences

• non satiation

• completeness

- this can be explained by the foregoing assumption.

• transitivity

• rational preferences

• non satiation

• completeness

- more or better property of preferences

• transitivity

• rational preferences

• non satiation

• completeness

Quantification of satisfaction

• cardinal utility theory

• ordinal utility theory

• cardinal ranking of preferences

• ordinal ranking of preferences

Answer explanation

Assumptions of Perfect Competition:

• Firms are price takers

• The firms in the same industry are selling homogenous or standardized product.

• none of the above

Variables and fixed costs arise regardless whether the firm is operating or not. It pays for the firm to continue operating even though losses are incurred in the short-run as long as these are smaller than fixed cost. When the price of the product is constant, the change in total revenue is equal to price.

• short run analysis of monopoly

• short run analysis of perfect competition

• long run analysis of monopoly

• long run analysis of perfect competition

the only thing consumers can do is to rank or order his preferences.

• cardinal utility theory

• ordinal utility theory

• cardinal ranking of preferences

• ordinal ranking of preferences

Answer explanation