Optimal consumption refers to Multiple Choice the mix of products that maximizes total utility for the limited amount of income consumers have to spend. the total number of products that maximizes total utility for consumers. the maximum total utility a consumer receives by the consumption of one more item. the amount demanded that will create the strongest economy.

Optimal consumption refers to Multiple Choice the mix of products that maximizes total utility for the limited amount of income consumers have to spend. the total number of products that maximizes total utility for consumers. the maximum total utility a consumer receives by the consumption of one more item. the amount demanded that will create the strongest economy.

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter6: Consumer Choice Theory

Section: Chapter Questions

Problem 1SQ

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Similar questions

With a greater amount of consumption, total utility Multiple Choice increases only if marginal utility increases. always increases. always decreases. increases as long as marginal utility is positive.
Marginal utility refers to the Multiple Choice additional utility from consuming the last unit of a good or service. change in utility from the last unit consumed of a good or service. utility derived from consuming all of the good or service. opportunity cost of a good or service.
Marginal utility is defined as the increment to total utility that results from the consumption of one more unit of some good or service. The equation for marginal utility is: Group of answer choices The change in total utility / the change in quantity The change in total utility / the change in total revenue The change in quantity / the change in total utility Total revenue / quantity demanded
A consumer currently spends a given budget on two goods, X and Y, in such quantities that the marginal utility of X is 15 and the marginal utility of Y is 8. The unit price of X is $3 and the unit price of Y is $2. The utility-maximizing rule suggests that this consumer should Multiple Choice a. decrease consumption of product X and increase consumption of product Y. b. increase consumption of product X and increase consumption of product Y. c. decrease consumption of product Y and increase consumption of product X. d. stick with the current consumption mix because it yields maximum utility.
Evaluate the one specific law which states that the marginal utility of a good orservice declines as more of the good or service is consumed in a specific timeperiod.
If a rational consumer is in equilibrium, then: a. the marginal utility obtained from one product is equal to the marginal utility obtained from any other product. b. the marginal utility per last dollar spent is the same for all goods consumed. c. total utility becomes zero. d. a reallocation of income would increase the consumer's total utility.
The law of diminishing marginal utility states that.. price must be lowered to induce firms to supply more of a product. beyond some point, additional units of a product will yield less and less extra satisfaction to a consumer. it will take larger and larger amounts of resources beyond some point to produce successive units of a product. total utility is maximized when consumers obtain the same amount of utility per unit of each product consumed.
marginal utility is a measure of the benefit (or value, or enjoyment) a person obtains by a) Consuming a single additional unit of a product. b)Selling a single additional unit of a product (and spending the resulting cash). c) Borrowing the dollar value of a single additional unit of a product (and spending it on something nice). d)Converting a single additional unit of product to an equivalent number of units.
A budget constraint is: Group of answer choices a line showing various combinations of goods that are affordable given consumer income. total income - total expenses. total utility given consumer choice. a comparison of total marginal and total utility.
True/False Marginal utility refers to the satisfaction or pleasure that occur due to the additional consumption of one more unit
When the consumer buys 60 units of quantity of goods at a price of 3 per unit what would be the total expenditure!!!!
This module considers important concepts in economics: Total Utility, Marginal Utility, Diminishing Marginal Utility, and Utility Maximization within a budget constraint. These tools can be applied to personal decision making, particularly the consumption choices we make. Microeconomics often considers rational optimizing behavior by individuals, including consumers. Use the Law of Diminishing Marginal Utility to discuss why Market Demand has to have a downward slope. In other words, in order for consumers to demand a higher quantity of an item, its price must fall. Also use the Law of Diminishing Marginal Utility to explain why consumers often prefer to purchase a variety of goods and services (in other words, we are unlikely to fill a grocery cart with many units of the exact same product). Finally, use the utility optimizing condition that the ratio of Marginal Utility to Price for any good has to be the same across all goods to justify why it may be rational behavior to buy an…