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University of Florida - ECON 2023 1)Preferences, Utility, and Indifference Curves I Economists assume that the goal of consumers is to A

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University of Florida - ECON 2023

1)Preferences, Utility, and Indifference Curves I Economists assume that the goal of consumers is to A. expend all their income.

2. do as little work as possible to survive.
3. consume as much as possible.

D. make themselves as well off as possible.

2. Which of the following is NOT an assumption regarding people's preferences in the theory of consumer behavior? A. Preferences are complete.

B. Preferences are transitive.

C.Consumers prefer more of a good to less.

D.All of the above are basic assumptions about consumer preferences.

3. A consumer prefers market basket A to market basket B, and prefers market basket B to market basket C. Therefore, A is preferred to C.

The assumption that leads to this conclusion is: A. all goods are good.

2. diminishing MRS.
3. assumption of rationality.
4. completeness.

E. transitivity.

4. If a market basket is changed by adding more of at least one good, then rational consumers will:

A.be unable to decide whether the first market basket is preferred to the second or vice versa.

B.rank the market basket as being just as desirable as before.

C.have indifference curves that cross.

D.more likely prefer a different market basket.

E.rank the market basket more highly after the change.

 

5. Adrian's total utilities of two consumption bundles are 50 and 100. This implies that

A. the consumer prefers the second bundle.

B the consumer likes the first bundle twice as much.

C. the consumer prefers the first bundle.

D. the consumer likes the second bundle twice as much.

6. An indifference curve represents bundles of goods that a consumer

A. ranks from most preferred to least preferred.

B. views as equally desirable.

C. refers to any other bundle of goods.

D. All of the above.

7. Economists use a preference map to illustrate that

A. preferences are transitive.

B. more is better than less.

C. preferences are complete.

D. All of the above

8. A

consumer's willingness to trade one good for another can be expressed by the

consumer's

A. marginal rate of substitution.

B. indifference curve.

C. Both A and B above.

D.None of the above.

9. Budget Constraints & Consumer Choice (Interior)

Economists assume consumers select a bundle of goods that maximizes their

wellminus−being subject to

A. their marginal rate of substitution.

B. their income.

C. relative prices.

D. their budget constraint.

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