{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

ExamIImicro2006

# ExamIImicro2006 - Exam II Answer the next question(s on the...

This preview shows pages 1–3. Sign up to view the full content.

Exam II Answer the next question(s) on the basis of the following two schedules which show the amounts of additional satisfaction (marginal utility) which a consumer would get from successive quantities of products J and K. Units Units of J M U j of K MU k 1 56 1 32 2 48 2 28 3 32 3 24 4 24 4 20 5 20 5 12 6 16 6 10 7 12 7 8 1. Refer to the above data. If the consumer has a money income of \$52 and the prices of J and K are \$8 and \$4 respectively, the consumer will maximize her utility by purchasing: A) 2 units of J and 7 units of K. C) 4 units of J and 5 units of K. B) 5 units of J and 5 units of K. D) 6 units of J and 3 units of K. 2. Refer to the above data. What level of total utility is realized from the equilibrium combination of J and K determined in the previous question? 3. Refer to the above data. If the consumer's money income were cut from \$52 to \$28, she would maximize her satisfaction by purchasing: Use the following to answer questions :

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
\$20 18 16 14 12 10 8 6 4 2 1 2 3 4 5 6 7 8 Quantity demanded T o t a l r e v e n u e TR 4. Suppose that the above total revenue curve is derived from a particular linear demand curve. That demand curve must be: 5. Suppose that the above total revenue curve is derived from a particular linear demand curve. That demand curve must be: A) inelastic for price declines that increase quantity demanded from 2 units to 3 units. B) elastic for price declines that increase quantity demanded from 5 units to 6 units. C) inelastic for price increases that reduce quantity demanded from 4 units to 3 units. D) elastic for price increases that reduce quantity demanded from 4 units to 3 units.
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}