13. The price of good X is $1.50 and that of good Y is $1.00.If a consumer considers the marginal utility of Y to be 30 utils, and is maximizing utility with respect to purchases of X and Y, then he or she must consider the marginal utility of X to be:

a. 15 utilsb. 20 utilsc. 30 utils.d. 45 utils.

14. The income effect captures which of the following economic phenomena?

a. If money incomes fall, people will purchase less of any given commodity. b. A decrease in the price of a major purchase has an effect similar to an increase in income, and this may prompt people to buy more of that good.c. The quantity of a good purchased may actually decrease as people's incomes rise. d. As people's incomes rise, they save proportionately more out of income, so they actually spend a smaller fraction of their incomes. e. If the price of a good drops, it is as though the prices of all other goods have risen, in relative terms, so smaller quantities of those other goods will tend to be bought.

15. As the (relative) price of beef rises, I eat more chicken instead. How do you describe this consumer behavior?

a. Production effect.b. Substitution effect.c. A change of taste.

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16. Consumer surplus is defined as the:

a. difference between the total utility of a good and the maximum amount that consumers are willing to pay for it.b. difference between the total utility of a good and the market price.c. sum of the total utility of a good and its market price.d. total revenue that producers receive from selling a particular good.e. sum of the marginal utilities for all consumers of a good.

17. The idea of "consumer surplus" reflects the notion that:

a. the gain consumers obtain with some purchases exceeds the gain suppliers obtain from selling. b. purchasing many goods is a real bargain for consumers, because they would have been willing to pay more than they actually do in order to get them. c. the marginal utility of the first units of a product consumed may exceed the total utility which the product supplies.d. total utility increases either when consumer incomes rise or when the prices they must pay for goods fall. e. when demand is price-inelastic, buyers can obtain a larger quantity for the expenditure of less money.

22.Numerical problem on consumer surplus: Assume that the demand for travel over a bridge takes the form Y = 1,000,000 - 50,000P, where Y is the number of trips over the bridge and P is the bridge toll (in dollars). Calculate the consumer surplus if the bridge toll is $1 and $20.

You Answer:Bridge toll is $1:__________Bridge toll is $20:__________ (Round your answer to two decimal places if it is not an integer. Please do NOT include $ or words like "million" in your answer.)

Part III.Essay

23. Mr. Economist says, "Consumers always find their optimal bundle of consumer goods when the marginal utility of the last unit of each good is equal."Do you agree or disagree? Explain.