Test Bank For Microeconomic Theory: Basic Principles and Extensions, 12th Edition

Microeconomic Theory Basic Principles and Extensions 12th Edition Nicholson Test Bank Full Download: http://testbanklive.com/download/microeconomic-theory-basic-principles-and-extensions-12th-edition-nicholson-t 1. Indifference curves: a. may sometimes intersect. b. are contour lines only of a linear utility function. c. are convex if the utility function is quasi-concave. d. shift when prices change. ANSWER: c POINTS: 1 2. For an individual who consumes only two goods, x and y, the opportunity cost of consuming one more unit of x in terms of how much y must be given up is reflected by: a. the individual’s marginal rate of substitution. b. the market prices of x and y. c. the slope of the individual’s indifference curve. d. none of the above. ANSWER: b POINTS: 1 3. If bundles of goods A and B lie on the same indifference curve, one can assume the individual: a. prefers bundle A to bundle B. b. prefers bundle B to bundle A. c. enjoys bundle A and B equally. d. bundle A contains the same goods as bundle B. ANSWER: c POINTS: 1 Questions 4 and 5 refer to an individual whose utility function is given by: . 4. With this utility function, the bundle (3,2) provides the same utility as the bundle: a. (2, 3). b. (2, 4). c. (2, 5). d. (3, 3). ANSWER: b POINTS: 1 5. For this utility function, the MRS: a. depends on the values of x and y. b. is always 0. c. is always 2. d. is always 4. ANSWER: c POINTS: 1 6. Which of these utility functions represent the same preferences as a. ? Copyright Cengage Learning. Powered by Cognero. Full download all chapters instantly please go to Solutions Manual, Test Bank site: testbanklive.com Page 1 b. c. d. All of the above represent the same preferences. ANSWER: d POINTS: 1 7. If utility is given by a. 0.4. b. 1.0. c. 2.5. d. 5.0. ANSWER: a POINTS: 1 , then the person’s MRS at the point x = 5, y = 2 is given by: 8. If utility is given by a. parabolas. b. hyperbolas. c. concentric circles. d. straight lines. ANSWER: d POINTS: 1 , this person’s indifference curves are: 9. Which of the following utility functions best represents the idea that two goods, x and y, are perfect complements? a. b. c. d. ANSWER: d POINTS: 1 10. If an individual’s utility function is quasi-concave, his or her MRS will: a. diminish as x is substituted for y. b. increase as x is substituted for y. c. be undefined except in special cases. d. always depend only on the ratio of x to y. ANSWER: a POINTS: 1 11. If utility is given by a. (1, 3). b. (2, 3). c. (4, 1). d. (4, 2). Copyright Cengage Learning. Powered by Cognero. then the bundle (3, 2) provides the same utility as the bundle: Page 2 Microeconomic Theory Basic Principles and Extensions 12th Edition Nicholson Test Bank Full Download: http://testbanklive.com/download/microeconomic-theory-basic-principles-and-extensions-12th-edition-nicholson-t ANSWER: c POINTS: 1 12. Which of the following utility functions would not be consistent with the notion that x and y are both “goods” with positive marginal utilities? a. b. c. d. ANSWER: d POINTS: 1 Problems 13 and 14 concern the CES utility function: . 13. For this utility function, marginal utilities are: a. negative for b. diminishing only for c. increasing for d. always positive. ANSWER: d POINTS: 1 14. For this utility function smaller values for imply: a. increasingly concave indifference curves. b. increasingly convex indifference curves. c. indifference curves that are convex, linear, and then concave. d. indifference curves that are concave, linear, and then convex. ANSWER: b POINTS: 1 Copyright Cengage Learning. Powered by Cognero. Full download all chapters instantly please go to Solutions Manual, Test Bank site: testbanklive.com Page 3