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WorksheetsUnit 2 - Final Quiz
Total questions: 15
Worksheet time: 6mins
A utility function that describes how much of one market basket is preferred to another is called
an ordinal utility function.
a cardinal utility function.
.a utility-maximizing function.
a definitive utility function.
Indifference curves cannot intersect because of the assumption that
indifference curves are negatively sloped.
marginal utility diminishes as more of that good is consumed.
preferences are transitive (multiple options)
preferences are complete.
If Karim's marginal rate of substitution of Ice Cream for Custard Dessert is 2, then we know that
he is willing to give up 2 units of Custard Dessert to get the next unit of Ice Cream.
he is willing to give up 2 units of Ice Cream to get the next unit of Custard Dessert.
2 units of Custard Dessert are identical to 2 units of Ice Cream.
he prefers to eat 2 units of Custard Dessert together with every unit of Ice Cream he eats.
Ordinal utility analysis Was developed by
J.R.Hicks & R.J.D. Allen
Samualson
Marshall and Jevons
Slutsky
Marginal utility is
Always zero
Increases at a diminishing rate
The utility derived from last unit
All the above
“Utility or satisfaction is a subjective concept; therefore it could only be ranked”. The statement supports
Cardinal utility
Ordinal utility
Behavioral theory
None of the above
Indifference curve is always
Concave to the origin
Convex to the origin
L shaped
A straight line
A consumer is in equilibrium when marginal utilities are:
Minimum
Highest
Equal
Increasing
Law of Equi-marginal Utlity is a law of:
Production
Consumption
Distribution
Exchange
MRS is the rate at which the consumer is willing to substitute one good for another without changing the level of
Income
Price
Satisfaction
None
Marginal Utility curve of a consumer is also his
Indifference Curve
Total Utility Curve
Supply Curve
Demand Curve
Indifference curve between income and leisure for an individual is generally
Concave to the Origin
Convex to the Origin
Negatively sloped straight lines
Positively sloped straight lines
Cardinal measurement is related to ____________________
Indifference curve
Equi-Marginal utility
Law of diminishing marginal utility
None of the Above
The change in total utility after each additional unit of consumption is called:
Satisfaction
Value
Marginal Utility
Benefit
Which of the following activities is least likely to exhibit the law of diminishing marginal utility?
a student answering multiple choice questions for an economics course
a wealthy individual shopping for a third luxury car
a child at a new school making ten new friends at once
a track athlete at practice running the 400 meter dash ten times in a row
