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WorksheetsQuiz on Utility Definition and Concept
Total questions: 10
Worksheet time: 5mins
What is utility in economics?
A measure of the production of goods
A measure of the quantity of goods consumed
A measure of the price of goods
A measure of satisfaction from consuming goods
What is the basis of the utility function?
The satisfaction of the consumer
The quantity of goods consumed
The price of goods
The production of goods
What is a characteristic of utility according to the text?
Independent of knowledge
Objective
Measurable
Dependent upon human needs
How is utility measured in the Cardinal Approach?
In subjective terms
In cardinal numbers
In ranking
In qualitative terms
What is a limitation of the Cardinal Approach in measuring utility?
Cannot compare different goods
Cannot always measure utility
Does not analyze price changes
Does not consider consumer preferences
How is utility measured in the Ordinal Approach?
In cardinal numbers
In qualitative terms
In ranking
In subjective terms
What is a limitation of the Ordinal Approach in measuring utility?
Assumes only two goods
Assigns numerical values easily
Always possible to compare goods
Considers all consumer choices
What does the Ordinal Approach assume about consumer choices?
Quantitative and transitive
Subjective and inconsistent
Transitive and consistent
Objective and consistent
What does the utility function measure?
How much one saves in a bank
How much one enjoys a movie
How much one invests in stocks
How much one earns from work
What is the utility of a good according to the text?
Is equated with usefulness
Is always measurable
Remains constant for all consumers
Differs from one consumer to another
