Teddy buys only chocolate chip cookies and hot chocolate and spends all of his income on
the two items. Suppose that Teddys marginal utility per dollar spent on cookies exceeds that
spent on hot chocolate. According to marginal utility theory, Teddy can m
The table above gives the utility from pens and pencils. If the consumer has an income of $4, pens
cost $1, and pencils cost $.20, what is theconsumers total utility when he or she maximizes utility?
If the price of pizza increases, the effect of the price hike is that
A) the marginal utility per dollar spent on pizza will increase.
B) the marginal utility per dollar spent on pizza will decrease.
C) the marginal utility per dollar spent on pizza will
In the figure above, the marginal utility of the third crate of tomatoes for the person with total utility
A) 13 units of utility.
B) 16 units of utility.
C) 32 units of utility.
D) 45 units of utility.
A given change in demand will yield a larger change in the quantity supplied
A) the more elastic is supply.
B) the longer the time frame under consideration.
C) the more plentiful are the resources necessary to produce the good of interest.
D) All of the
A determinant of the price elasticity of supply is
A) the extent to which consumers like the quality of the good.
B) the extent to which the demand for the good is relatively elastic.
C) the extent to which the good has many con-sumer substitutes.
The elasticity of the momentary supply curve for any good
A) is necessarily equal to zero.
B) is necessarily equal to one.
C) is necessarily equal to positive infinity.
D) None of the above answers is correct.
If a good is produced using inputs for which there are no substitutes, the goods
A) elasticity of supply is likely to be small.
B) elasticity of supply is likely to be large.
C) elasticity of demand will be small.
D) elasticity of demand will be large.
The elasticity of supply is
A) positive and more elastic in the long run.
B) positive and more elastic in the short run.
C) negative and more elastic in the long run.
D) negative and more elastic in the short run.
If the price elasticity of demand for a product equals 1, as its price rises the
A) quantity demanded increases.
B) total revenue increases.
C) quantity demanded does not change.
D) total revenue does not change.
A product is likely to have a price elasticity of demand that exceeds 1 when
A) its price falls.
B) the percentage of income spent on it decreases.
C) it is a necessity.
D) it has close substitutes.
The quantity of new cars increases by 10 percent. If the price elasticity of demand for new
cars is 1.25, the price of new cars will fall by
A) 2.5 percent.
B) 8 percent.
C) 10 percent.
D) 12.5 percent.
Which of the following is a microeconomic topic?
A) The reasons why Kathy buys less orange juice.
B) The reasons for a decline in average prices.
C) The cause of why total employment may decrease.
D) The effect of the government budget deficit on
The first electronic general purpose digital computer built by Mauchly and Eckert called
ENIAC did not work on the stored program principle. How many numbers could it store in its
None of the above
Economics is best defined as the study of how people, businesses, governments, and
A) choose abundance over scarcity.
B) make choices to cope with scarcity.
C) use their infinite resources.
D) attain wealth.
In broad terms the difference between microeco-nomics and macroeconomics is that
A) they use different sets of tools and ideas.
B) microeconomics studies decisions of individual people and firms and macroeconomics
studietheentire national economy.
Which is the most accurate definition of the study of economics?
Economics is the study of
A) the distribution of surplus goods to those in need.
B) affluence in a morally bankrupt world.
C) the choices we make because of scarcity.
D) ways to reduce wants
Microeconomics focuses on all of the following
A) the purchasing decisions that an individual con-sumer makes.
B) the effect of increasing the money supply on in-flation.
C) the hiring decisions that a business makes.
D) the effect of an increase i
Which of the following is a macroeconomic topic?
A) The reasons for a rise in the price of orange juice.
B) The reasons for the rise in average prices.
C) Why plumbers earn more than janitors.
D) Whether the army should buy more tanks or more rockets.