Part 1.

Question 4 of 15

Dali enjoys beer ad steak for lunch. His monthly lunch budget is R600. Use the following table to determine which quantities of beer and steak he will consume at consumer equilibrium.

Beer / Bier

Steak / Biefstuk

Prys

R30

R40

Q

TU_B

TU_s

5

269

491

6

279

511

7

285

523

8

288

530

9

289

534

10

289

536

• A.

10 beers and 10 steaks.

• B.

10 beers and 9 steaks.

• C.

9 beers and 8 steaks.

• D.

8 beers and 9 steaks

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Question 5 of 15

Which of the following statements regarding utility is true?

• A.

When consuming the same good, utility is constant across individuals.

• B.

When consuming the same good, utility varies across individuals.

• C.

A specific product has a unique, measurable utility that is the same at different times and places.

• D.

Utility always rises at a constant rate.

Question 6 of 15

Use the following table to determine the marginal utility for beer and Red Bull at 2 units of each good.

• A.

8 for beer and 30 for Red Bull.

• B.

40 for beer and 105 for Red Bull.

• C.

14 for beer and 45 for Red Bull.

• D.

4 for beer and 60 for Red Bull.

Question 7 of 15

Use the table and additional information below to determine the consumer's equilibrium position, assuming that the entire income is spent on coffee and Red Bull. The price of coffee is R20 per cup, the price of Red Bull is R30 per unit and income is R120.

• A.

6 units of coffee and 0 units of Red Bull.

• B.

3 units of coffee and 2 units of Red Bull.

• C.

1 unit of coffee and 3 units of Red Bull.

• D.

2 units of coffee and 4 units of Red Bull.

Question 8 of 15

Which one of the following statements isincorrect?

• A.

The following series of total utilities is in accordance with the law of diminishing marginal utility: 25, 40, 53, 65, 75, 83, 90, 95, 98, 100.

• B.

A consumer can only be in equilibrium if he or she can afford to purchase the relevant combination of goods or services.

Marginal utility is the additional (extra) utility that a consumer derives from the consumption of an additional unit of the good or service.

• D.

Economists use scientific techniques to measure utility on an objective scale (similar to how scientists measure the intensity of earthquakes on the Richter scale)

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Question 8 of 15

Which one of the following statements isincorrect

• A.

The following series of total utilities is in accordance with the law of diminishing marginal utility: 25, 40, 53, 65, 75, 83, 90, 95, 98, 100.

• B.

A consumer can only be in equilibrium if he or she can afford to purchase the relevant combination of goods or services

• C.

Marginal utility is the additional (extra) utility that a consumer derives from the consumption of an additional unit of the good or service.

D.

Economists use scientific techniques to measure utility on an objective scale (similar to how scientists measure the intensity of earthquakes on the Richter scale).

Question 9 of 15

If a consumer has spent all her income on two goods, A and B, and we find that MU_A/MU_B= P_A/P_B, what can we say about the consumer

• A.

The consumer cannot increase her utility.

B.

The prices of goods A and B must be equal.

• C.

The consumer should purchase more of A and less of B.

• D.

The consumer should purchase more of B and less of A.

Part 2

Question 4 of 10

In the long run:

• A.

output is fixed at a maximum.

• B.

all inputs are fixed.

• C.

all inputs are variable.

• D.

one input is fixed and another is variable.

Question 5 of 10

In a perfectly competitive market for widgets, the market price is R15. Use the cost information for a firm producing widgets in this market given in the table below, the firm should:

• A.

expand production

• B.

shut down

• C.

break even

• D.

maximise profits by producing 8 books

Question 6 of 10

In the short run, if the value of MP is equal to AP:

• A.

then AP increase.

• B.

TP is then at a maximum.

• C.

TP is then at a minimum.

• D.

AP is then at a maximum.

Question 8 of 10

A small farmer is more likely to operate in a perfectly competitive market than a company like SABMiller because...

• A.

The demand for beer is less elastic than the demand for food.

• B.

A small business is more likely to keep close control on costs than a large firm.

• C.

A small farmer supplies a small share of market supply.

• D.

SABMiller employs many people, whereas perfectly competitive firms are owner-managed.

Question 10 of 10

1 Points

Which of the following is NOT a characteristic of a competitive market?

• A.

No price floors or price ceilings.

• B.

Large initial capital outlays.

• C.

No collusion among sellers.

• D.

Many buyers.