ECON 101 Study Guide - Midterm Guide: Marginal Utility, Indifference Curve, Giffen Good

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21 Dec 2015

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Utility - the satisfaction that a consumer receives from consuming some good or service. Total utility - the total satisfaction resulting from the consumption of a given commodity by a . Marginal utility (mu) - the additional satisfaction obtained from consuming 1 additional unit of a commodity. Diminishing marginal utility the utility that any consumer derives from successive units of a particular product consumed over some period of time diminishes as total consumption of the product . Maximizing utility a utility-maximizing consumer allocates expenditures so that the mu . Obtained form the last $ spent on each product is equal. Real income income expressed in terms of the purchasing power of money income that is, the q of goods. And services that can be purchased with the money income . Substitution effect the change in the q of a good demanded resulting from a change its relative price (holding.

Related Questions

Marginal utility is defined as the

a. extra satisfaction the consumer receives from an extra $1 of income.

b. total level of satisfaction a consumer receives upon the consumption of a certain number of goods.

c. number of hours a consumer would be willing to work to receive a certain product.

d. extra satisfaction a person derives from consuming an additional unit of a good.

tanfish840

1. If marginal utility is negative, total utility is

a. Positive

b. Negative

c. Decreasing

d. Constant

e. Increasing

2. If utility-maximizing consumers face identical prices, they will have identical

a. Marginal utilities for each good

b. Ratio of marginal utilities for each good

c. Preferences

d. Ratios of total utilities for each good

e. Total utilities for each good

3. The substitution effect

a. Always increases quantity demanded of a good whose relative price has fallen

b. Is opposite in sign to the income effect for all normal goods

c. Is opposite in sign to the income effect for all normal goods

d. May cause demand curves to be upward sloping

e. Is always dominated by the income effect for normal goods

4. Demand curves for normal goods slope downward because

a. The substitution effect of a price change is greater than the income effect

b. Substitution and income effects work in the same direction

c. The income effect is always greater than the substitution effect

d. The income effect is always less than the substitution effect

e. None of the above

5. The idea that a consumer derives less additional satisfaction from consuming successive units of a good is called

a. Diminishing consumer surplus

b. The paradox of value

c. Diminishing marginal utility

d. Diminishing total value of consumption

e. Diminishing total utility

indigolocust149

1. Which of the following defines marginal utility?

A. the change in total utility divided by the price of a product

B. the maximum amount of satisfaction from consuming a product

C. the total satisfaction received from consuming as much of the product that is available for consumption

D. the additional satisfaction received from consuming one more unit of a product

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ECON 101 Study Guide - Midterm Guide: Marginal Utility, Indifference Curve, Giffen Good

ECON 101 Full Course Notes

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