Practice Cardinal Utility Analysis (2.1.1) - Theory of Consumer Behaviour

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9 questions

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6 sample questions

Question 1.
Define Total Utility.
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Think about the entire experience of consuming the goods.
Question 2.
What does Marginal Utility represent?
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Consider how satisfaction changes with an extra unit.
3Question 3.
What is Total Utility?
- A measure of satisfaction
- The total amount spent
- How much a good is worth
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Focus on the meaning of satisfaction in economics.
4Question 4.
True or False: The Law of Diminishing Marginal Utility states that more consumption always increases total utility.
- True
- False
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Consider what happens as you consume more.
Question 5.
You consume apples receiving 10, 8, 6, and 4 units of total utility for each additional apple. Calculate the marginal utility for each apple consumed.
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Apply subtraction between total utilities.
Question 6.
If you increase your consumption from 3 oranges to 6 oranges and your total utility rises from 30 to 70, what is the average marginal utility from these additional oranges?
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Calculate the total increase over the number of new units consumed.

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