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Clara consumes goods x and y. Her indifference curves are described by the formula y=k/(x+5). Higher values of k correspond to better indifference curves. Which of the following is true?

A. Clara likes good y and hates good x.

B. Clara prefers bundle (11,13) to bundle (13,11).

C. Clara prefers bundle (7,3) to bundle (3,7).

D. Clara likes good x and hates good y.

E. More than one of the above statements is true.

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Darryn D'Souza
Darryn D'SouzaLv10
28 Sep 2019

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Related questions

Use the figure below to answer the following question. Good Y Good x Figure 9.2.2 10) Figure 9.2.2 shows three indifference curves for Brenda. Which one of the following is not true? A) Brenda prefers consuming at point to consuming at either point B or pointC. B) Brenda would be equally happy consuming at either pointB or point. The marginal rate of substitution is higher at point than at pointB. D) Brenda prefers consuming at point to consuming at point A. E) Brenda prefers consuming at point to consuming at point A.

1.

Suppose all consumers are maximizing utility with convex indifference curves. All face the same prices, and are perfectly rational. According to microeconomic models, at the maximization bundle they should

A. All have the same marginal rate of substitution

B. All buy more of the least expensive good

C. All end up with the same bundle of goods

D. All have the same level of satisfaction

2.

Consider an indifference map with food on the vertical axis and shelter on the horizontal axis.

If a consumer is willing to give up 3 units of food in exchange for 1 unit of shelter and food is priced at $5 per unit and shelter at $10 per unit, then the consumer is:

A. Purchasing too much food for utility maximization

B. Purchasing too much shelter for utility maximization

C. Purchasing just the right amount of each good for utility maximization

D. Purchasing less than the budget would allow

3.

If a consumer with convex indifference curves moves along her budget line, closer and closer to the horizontal axis, as she is moving:

A. The marginal utility she gets from good Y declines.

B. The marginal utility she gets from good X declines.

C. The marginal utility she gets from good X increases.

D. The price ratio of the two goods changes.

1. Assume that beer is an inferior good for Wei. If the price of beer goes up, then the total effect results in Wei buying _______ beer and the substitution effect results in Wei buying ______ beer.

a.

more, more

b.

more, less

c.

less, more

d.

less, less

e.

not enough information to determine

2. A consumer has preferences that are complete, transitive and satisfy the "more is better" property. Which of the following statements are necessarily true?

a.

Indifference curves are negatively sloped.

b.

Indifference curves do not cross.

c.

Indifference curves exhibit diminishing marginal rates of substitution.

d.

Both a) and b) are true.

e.

a), b), and c) are true.

3. Suppose an individual has preferences over two goods - good X and good Y. In response to changes in the price of good X, the individual has a positively sloped price consumption curve, where good X is drawn on the horizontal axis. Which of the following statements is true?

a.

Good Y is a normal good.

b.

Good Y is a Giffen good.

c.

Good Y is a complement for good X.

d.

Good Y is an inferior good.

e.

Good Y is a substitute for good X.

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