Topic Questions (MCQ – EASY): Utility – 3auk

The table displays the total utility obtained by a consumer as she increases her pear consumption. At what level of consumption does the marginal utility become zero?

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To maximize satisfaction from a given expenditure on two goods, X and Y, how should a consumer allocate their expenditure between the two goods?

Allocate expenditure such that the marginal utility of X equals the price of X and the marginal utility of Y equals the price of Y.

Allocate expenditure such that the sum of the marginal utility of X and the marginal utility of Y is maximized.

Allocate expenditure such that the marginal utility of X equals the marginal utility of Y.

marginal utility of X / marginal utility of Y = price of X / price of Y

An individual derives total utility from consuming various quantities of a good, as depicted in the table.

For the individual, one unit of money is equivalent to three units of utility.
When the price of the good is $4, what is the highest quantity the individual will purchase?

2 units

3 units

4 units

5 units

6 units

When a consumer seeks to maximize their utility, what is the stopping point for consuming each good?

The point at which the marginal utility per dollar is equal for each good.

The point at which the marginal utility is equal for each good.

The point at which the marginal utility for each good reaches its maximum.

The point at which the marginal utility for each good is zero.

The diagram illustrates the marginal utility obtained by an individual from consuming various amounts of good X. At the margin, the individual obtains two units of utility per dollar spent. What quantity of good X will the individual purchase if the price of X is $2?

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