Quiz 3 - Oct 11 - WITH ANSWERS

# Quiz 3 - Oct 11 - WITH ANSWERS - Quiz #3: Friday, October...

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Quiz #3: Quiz #3: Friday, October 11 Friday, October 11 Olivier Giovannoni 304K: Introduction to Microeconomics

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Question 1 Consumption choices (=possibilities) are limited by A) the person's preferences for goods and services. B) the person's indifference curves. C) the person's income and the prices of goods. D) only prices and the person's preferences. Question 2 If two goods are complements, then their A) marginal rate of substitution is infinity. B) indifference curves are negatively sloped straight lines. C) indifference curves are L-shaped. D) indifference curves are positively sloped straight lines.
Question 3 Julie's demand curve for videos is downward sloping because as the price of a video decreases, ________ and she watches ________ videos. A) her budget line shifts outward; more B) the slope of her budget line changes; more C) the slope of her budget line changes; fewer D) her budget line shifts inward; fewer Question 4 When a consumer is at her best affordable point, A) the MRS reaches its minimum value. B) the MRS equals the relative price ratio. C) relative prices reach their minimum value. D) the MRS equals one.

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Question 5 Sue consumes apples and bananas. Suppose Sue's income doubles and the prices of apples and bananas do not change. Sue's budget line A) will remain unchanged. B)
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## This note was uploaded on 04/27/2008 for the course ECON 304K taught by Professor Ledyard during the Fall '08 term at University of Texas at Austin.

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Quiz 3 - Oct 11 - WITH ANSWERS - Quiz #3: Friday, October...

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