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    WS 1 Xi

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    kanishkau568

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    WS 1 Xi

    Uploaded by

    kanishkau568
    16 views2 pages

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    WS 1 XI

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    16 views2 pages

    WS 1 Xi

    Uploaded by

    kanishkau568

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    WORKSHEET ON CH.

    2 CONSUMER’S EQUILIBRIUM

    1. What does the term ‘marginal’ in economics mean?


    A) Additional B) Unimportant C) Minimum unit D) None of the above
    Ans. (A) Additional.
    2. Which of the following must be true when the marginal is negative?
    A) The average is positive. B) The average is negative.
    C) The total is decreasing. D) The total is negative.
    Ans. C) The total is decreasing.
    3. Utility is generally related to?
    A) Satisfaction B) Necessary C) Useless D) Useful
    Ans. (A) Satisfaction.
    4. Why are indifference curves convex to the origin?
    A) Two goods are perfect complementary goods.
    B) Two goods are imperfect substitutes.
    C) Two goods are perfect substitutes.
    D) None of the above
    Ans. B) Two goods are imperfect substitutes.
    5. When the marginal utility is equal to zero, what will the total utility be?
    A) Maximum B) Laws of return C) Minimum D) None of the above
    Ans. A) Maximum.
    6. Why is a consumer’s spending restricted?
    A) Due to the utility maximisation B) Due to the budget constraint
    C) Due to the demand curve D) Due to the marginal utility
    Ans. B) Due to the budget constraint.
    7. When MU is positive, what happens to TU?
    A) It decreases. B) It becomes the highest. C) It remains constant.
    D) It increases.
    Ans. D) It increases.

    8. If a consumer has monotonic preferences, which bundle would be preferred by him ?

    A
    (12,8) B (12,12) C (10,6) D (8,12)

    Ans. A (12,8)

    9. An indifference schedule represents various bundles that give __________ level of satisfaction

    Ans. Same.
    10. Which of Gossen’s laws is the First?
    Law of Diminishing Marginal Utility
    Law of Demand
    Surplus of the Consumer
    Law of Equi-marginal Utility
    Ans. Law of diminishing marginal utility.
    11 Which of the statements below is correct?
    a) Utility means desire-satisfying power
    b) The utility is a function of desire intensity
    c) Consumption desire gives rise to utility
    d) All of the above.
    Ans. d) All of the above.
    12. Who was the one who coined the term “utility”?
    a) Pigou b) Marshall c) Hicks d) Samuelson
    Ans.
    13. What is the formula for calculating marginal utility?
    a) ∆MU/∆Q b) ∆TU/∆Q c) ∆Q/∆MU d) ∆Q/∆TU
    Ans.b) ∆TU/∆Q
    14 . Who was the one who first proposed the ordinal utility theory?
    Hicks and Allen
    Pigou
    Marshall
    Ricardo
    Ans. Hicks and Allen.
    15. Which of the following are properties of indifference curves?
    Indifference curves can never cross,
    the lower the utility indicated by a farther out indifference curve,
    indifference curves always slope upwards, and
    indifference curves are concave.
    Ans. Indifference curves can never cross.

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