Mrs. Arnold is spending all her money income by buying bottles of soda and bags of pretzels in such amounts that the marginal utility of the last bottle is 40 utils and the marginal utility of the last bag is 60 utils. The prices of soda and pretzels are $0.75 per bottle and $1 per bag, respectively. It can be concluded that Multiple Choice eBook O the two commodities are substitute goods. O Mrs. Arnold should spend less on pretzels and more on soda. O Mrs. Arnold should spend less on soda and more on pretzels. O Mrs. Arnold is buying soda and pretzels in the utility-maximizing amounts.2 The table shows the total utility data for products X and Y. Assume that the prices of X and Y are $1.5 and $2, respectively, and that consumer income is $9. Units of X Total Utility Units of Y Total Utility 1 9 1 16 2 15 2 28 3 19 3 36 eBook 4 21 4 40 5 22 5 42 How many units of the two products will the consumer buy to get maximum utility? Multiple Choice O 3 of X and 2 of Y O 1 of X and 4 of Y O 2 of X and 3 of Y O 6 of X and 0 of Y3 The table shows a consumer's utility schedule. Total Number of Units Consumed Utility 0 1 4 NJ ebook 10 18 23 5 25 Based on the data in the table, you can conclude that the Multiple Choice O marginal utility of the third unit is 32. O total utility of 5 units is 125. O total utility of 4 units is 5. O marginal utility of the first unit is 4.4 If MU /Pa = 50/$4 = MUp/Pp= 80/? = MU/Pc=125/7, the prices of products B and C in consumer equilibrium Multiple Choice ebook O cannot be determined from the information given. O are $6.4 and $10, respectively. O are $7.5 and $14, respectively. O are $8 and $12, respectively.5 A consumer currently spends a given budget on two goods, X and Y, in such quantities that the marginal utility of X is 6 and the marginal utility of Y is 12. The unit price of X is $2 and the unit price of Y is $3. The utility-maximizing rule suggests that this consumer should Multiple Choice ebook O increase consumption of product X and decrease consumption of product Y. O increase consumption of product X and increase consumption of product Y. O increase consumption of product Y and decrease consumption of product X. O stick with the current consumption mix because it yields maximum utility.6 The table shows the utility schedule for a consumer of candy bars. Total Number Consumed Utility 0 1 5 11 ebook W 18 4 24 5 30 35 7 32 Based on the data in the table, you can conclude that the Multiple Choice O marginal utility of the third unit is 54. O marginal utility of the second unit is 11. O total utility of 6 units is 123. O total utility of 7 units is 32.7 Suppose that Ms. Thomson is currently exhausting her money income by purchasing 10 units of A and 8 units of B at prices of $8 and $2, respectively. The marginal utility of the last units of A and B are 24 and 10, respectively. These data suggest that Ms. Thomson Multiple Choice ebook O has preferences that are at odds with the principle of diminishing marginal utility. O considers A and B to be complementary goods. O should buy more A and less B. O should buy more B and less A.8 Answer the question based on the table below showing the marginal utility schedules for product X and product Y for a hypothetical consumer. The price of product X is $4, and the price of product Y is $2.75. The income of the consumer is $15. Product x Product Y Quantity MUy Quantity MUy 1 32 1 24 eBook 28 2 20 W N 24 16 20 12 5 16 5 8 If the consumer buys product X or product Y one unit at a time, which of the following will the consumer's first two purchases be? Multiple Choice O a first unit of X followed by a first unit of Y O a first unit of X followed by a second unit of X O a first unit of Y followed by a second unit of Y O a first unit of Y followed by a first unit of X9 Suppose Justine and Sarah are playing the dictator game. Justine is the dictator and has $240 to allocate. Based on repeated experiments of the dictator game, what is the least likely outcome for this game? Multiple Choice ebook O $240 for Justine and $0 for Sarah. O $140 for Justine and $100 for Sarah. O $120 for Justine and $120 for Sarah. O $0 for Justine and $240 for Sarah.10 Suppose Justine and Sarah are playing the ultimatum game. Justine is the proposer, has $75 to allocate, and Sarah can accept or reject the offer. Based on repeated experiments of the ultimatum game, what combination of payouts to Justine and Sarah is most likely to occur? Multiple Choice ebook O $75 for Justine and $0 for Sarah O $38 for Justine and $36 for Sarah O $45 for Justine and $30 for Sarah O $0 for Justine and $75 for SarahSuppose Faith and Mickey are playing both dictator and ultimatum games. Faith is the dictator/proposer and has $20 to allocate. Based on repeated experiments of the dictator and 11 ultimatum games, what payouts to Mickey would be most consistent with the findings of behavioral economists? Multiple Choice ebook O Mickey receives $0 from the dictator game and $2 from the ultimatum game. O Mickey receives $10 from the dictator game and $8 from the ultimatum game. O Mickey receives $10 from the dictator game and $10 from the ultimatum game. O Mickey receives $8 from the dictator game and $10 from the ultimatum game.12 Parker's shares of stock in ACME Corporation lost $200 in value, but his shares in XYZ, Inc. gained $500. According to behavioral economics research, how would Parker feel as a result of these changes? Multiple Choice ebook O Parker would feel better off. O Parker would feel about the same. O Parker would feel worse off. O Behavioral economics research suggest that the intensity of losses versus gains follows no measurable pattern.Huxley lost $80 in the stock market. According to behavioral economics research, how much of a gain would he have to experience to offset the feeling of loss and have no net change in 13 utility? Multiple Choice 2Book O $80 O $200 O $32 O $120A child is given $4.80 of pocket money to be spent on either hard candies or chocolates. Chocolates cost 40 cents and hard candies $1.20 each. The marginal utilities derived from each 14 product are as shown in the following table. Number of Items MU of Chocolates MU of Hard Candies 1 60 150 2 50 140 40 120 eBook 30 100 5 20 80 6 10 70 7 5 50 8 0 20 Which combination would give the child the maximum utility out of spending $4.80? Multiple Choice O 6 chocolates and 2 hard candies O 8 chocolates and O hard candies O 3 chocolates and 3 hard candies O 0 chocolates and 4 hard candies15 Assume that a consumer purchases a combination of products Y and Z and that the MU /Py = 22 and MU_/P2 =25. To maximize utility, without spending more money, the consumer should Multiple Choice eBook O purchase less of Z and more of Y. O purchase more of Z and less of Y. O purchase more of both Y and Z. O make no change in the quantities Y and Z.16 The first Pepsi yields Craig 12 units of utility and the second yields him an additional 15 units of utility. His total utility from three cans of Pepsi is 36 units of utility. The marginal utility of the third Pepsi is Multiple Choice ebook O 21 units of utility. O 27 units of utility. O 9 units of utility. O 36 units of utility.17 According to behavioral economics research, in which of the following cases would we expect a person to experience no net change in their utility? Multiple Choice eBook O When the person gains $30 and loses $30. O When the person gains $75 and loses $30. O When the person gains $30 and loses $75. O When the person gains $30 while everyone else gains $30.18 Assume that a consumer purchases a combination of product A and product B such that the MU,/P. = 5 and MUb/Pp =4. To maximize utility without spending more money, the consumer should Multiple Choice eBook O purchase less of product A and more of product B. O purchase more of product A and less of product B. O purchase more of both product A and product B. O make no change in purchases of products A and B.19 Rosa received a corgi pillow as a raffle prize; she would have been willing to pay $10 to buy it herself. Based on the endowment effect, we would expect Rosa to be willing to sell the pillow Multiple Choice ebook O for some amount less than $10. O only if she is offered more than $10. O for the $10 she would have been willing to pay for the pillow. O under no circumstances whatsoever.20 The table shows an indifference schedule for several combinations of X and Y. Combination Quantity of X Quantity of Y 20 b 16 IN C 12 3 eBook d 10 4 e 9 5 In moving from combination d to e, the consumer Multiple Choice O gets 1 unit of X for 1 unit of Y. O gets 10 units of X for 5 units of Y. O gives up 10 units of X for 5 units of Y. O gives up 1 unit of X for 1 unit of Y