Question 1

 A utility function shows the relation between income and utility.

Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 2
 A person's utility schedule can change over time.
Response: True
Correct answer: True
Score: 1 out of 1 Yes

Question 3
 If water became very scarce and diamonds became very plentiful the marginal utility of
diamonds would rise and the marginal utility of water would fall.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 4
 If Rachel bought too many hot dogs, her marginal utility would become negative and
her total utility would stop rising.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 5
 It would be meaningless to say that a certain good is worth Php500.
Response: True
Correct answer: True
Score: 1 out of 1 Yes

Question 6
 If marginal utility is declining but still greater than zero, then total utility is declining for a
while but increasing as it approaches zero.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 7
 Katie went shopping for shoes and had plenty of money with her. She will keep buying
shoes until she runs out of money.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 8
 Utility is measured by how much a person is willing to pay for a good or service.
Response: True
Correct answer: True
Score: 1 out of 1 Yes

Question 9
 The law of diminishing marginal utility has become less valid as consumers spend
more money on services.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 10
 The utility of a satellite dish is greater than the utility of a cell phone.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 11
 The rate at which a consumer is ABLE to substitute one good for another is determined
by the indifference curve.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 12
 If you purchased six dance lessons, the total utility you derived from the six lessons
would be greater than the total utility you would have derived from five lessons.
Response: True
Correct answer: True
Score: 1 out of 1 Yes

Question 13
 If you know a person's demand schedule you can find her marginal utility, but not her
total utility.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 14
 If you knew a person's demand schedule, you could figure out her marginal utility
schedule.
Response: True
Correct answer: True
Score: 1 out of 1 Yes

Question 15
 As a young man, my brother ate 13 banana splits on a Saturday afternoon and never
ate another one for the rest of his life. Most likely the utility of his last banana split was
zero.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 16
 If a 1,000-peso bill were found lying on the sidewalk, if a poor person found it, she
would get more utility from what she could buy with it than a rich person.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 17
 Utility is measured by a product's usefulness.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 18
 Kelly eats five slices of pizza on a Friday night but admits each slice of pizza doesn't
taste as good as the previous one. This suggests that for Kelly the total utility of slices of
pizza is declining. the total utility of slices of pizza is declining.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 19
 Marginal utility is the usefulness a consumer derives from a certain good or service.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 20
 A product's utility to a buyer is measured by how much the buyer is willing to pay for it.
Response: True
Correct answer: True
Score: 1 out of 1 Yes

Question 21
 As marginal utility declines, total utility rises.
Response: True
Correct answer: True
Score: 1 out of 1 Yes

Question 22
 If you received a free month's trial membership in a gym, you would keep going until
your marginal utility reached zero.
Response: True
Correct answer: True
Score: 1 out of 1 Yes

Question 23
 If a good is free, you will consume more and more of it until your marginal utility is zero.
Response: True
Correct answer: True
Score: 1 out of 1 Yes

Question 24
 The law of diminishing marginal utility states that as we consume increasing amounts
of a good or service, we derive diminishing total utility or satisfaction from each
additional unit consumed.
Response: False
Correct answer: False
Score: 1 out of 1 Yes

Question 25
 The marginal utility of the water we consume is quite low.
Response: True
Correct answer: True
Score: 1 out of 1 Yes