QUESTION 1

1. Assume that Gina is allocating her budget optimally between two products. If the MU of product X is 40 and its price is $8, what must be the price of product Y if its MU is 60?

		$7.50.
		$12.
		$16.
		$40.
		$300.

QUESTION 2

1. What is meant by the termutility?

		A measure of a product's usefulness.
		A measure of necessity.
		The satisfaction or pleasure derived from the consumption of a product.
		The benefit derived from the production of a product.

QUESTION 3

1. What will happen if MUA/PA>MUB/PB?

		The price of A will be forced to drop.
		The price of B will be forced to drop.
		The consumer will purchase more of product A.
		The consumer will purchase more of product B.

QUESTION 4

1. Under which of the following circumstances will consumers' surplus be greatest?

		When price is high and demand is elastic.
		When price is low and demand is inelastic.
		When price is low and demand is elastic.
		When price is high and demand is inelastic.

QUESTION 5

1. What is the term for the selling of an identical product at a different price to different customers for reasons other than cost?

		Price discrimination.
		Product substitution.
		Marginal utility.
		Consumer surplus.