Marginal Utility MU, 0 $5,000 10,000 15,000 Income Singer Marginal Utility Multiple Choice MU, 0 $5,000 10,000 15,000 Income Catalano Refer to the above diagrams that show identical marginal utility from income curves for Singer and Catalano. If this initial distribution of $15,000 to Singer and $5,000 to Catalano is altered in favor of greater equality, it may be argued that: the combined total utility of the two consumers will decline because Catalano has a greater capacity to derive utility from income than does Singer. incentives to produce will be weakened and total income will decrease. incentives to produce will be enhanced and total income will increase. the combined total utility of the two consumers will decline because Singer has a greater capacity to derive utility from income than does Catalano.

Marginal Utility MU, 0 $5,000 10,000 15,000 Income Singer Marginal Utility Multiple Choice MU, 0 $5,000 10,000 15,000 Income Catalano Refer to the above diagrams that show identical marginal utility from income curves for Singer and Catalano. If this initial distribution of $15,000 to Singer and $5,000 to Catalano is altered in favor of greater equality, it may be argued that: the combined total utility of the two consumers will decline because Catalano has a greater capacity to derive utility from income than does Singer. incentives to produce will be weakened and total income will decrease. incentives to produce will be enhanced and total income will increase. the combined total utility of the two consumers will decline because Singer has a greater capacity to derive utility from income than does Catalano.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: 6. Suppose that a fast-food junkie derives utility from three goods - softdrinks (x), 0.5 0.5…

A: Given, Utility Function: U(x,y,z)=x0.5y0.5(1+z)0.5 px=0.25py=1pz=2 Income (M) = 2

Q: Total utility (utils) 0 25 45 60 70

Q: Suppose there are two agents Ahmet and Berk in an economy, and both consume two goods X and Y. Also…

A: A want satisfying power of a commodity or service is known as its utility. Utility is a significant…

Q: Suppose Natasha consumes two goods: good 1 and good 2. Last year, the price of good 1 was $2.00 and…

A: Laspeyres Index is a consumer price index used to calculate the change in prices of a basket of…

Q: marginal utility for custard (U.). What is Amelia's marginal rate of substitution (MRS)? Give a…

A: Different utility levels of consumers are taken to be independent. This means that utility obtained…

Q: If a and ß are just parameters and if the direct utility function is u (x1, X2) = a · In(x1) + ß ·…

A: We have formula fro MRS = -MUx/MUy

Q: Consider the following 6 utility functions: U1 = /x + 2y U2 = v2x + Jy U3 = 2x2 + y? + Jy U5 =…

A: *Hi there as you have posted multiple sub parts , as per our guidelines we will only first three .…

Q: 2. Given the utility function U = x0.5y0.5 calculate the utility of consuming bundle z:[25,49].…

A: Marginal rate of substitution is equal to the ratio of marginal utility of good 1 with respect to…

Q: Ayana is pitching an idea for a startup company that makes and sells solar-powered phonechargers…

A: ***Since the student has posted a question with multiple subparts, so the expert is required to…

Q: e) Do any of these three friends violate the property of "more is better" for junior mints? Or do…

A: Marginal utility:Marginal utility is the additional unit that is added to the total utility. It is…

Q: %3D Ollie's utility function for Apples (A) and Bananas (B) is Cobb-Douglas: U = AB/6 a. Find…

A: MRS = (MUA/MUB) We have the utility function : U = AB/6 MUA = dU/dA = differentiate the utility…

Q: Question 1 Consider an economy with two goods t = 1,2. Whenever an individual consumes ₁ units of…

A: As given utility function is u(x1,x2) = αlnx1 +lnx2 Where α>0

Q: Is it reasonable to assume that people seek to equate the marginal utility/price ratios of the goods…

A: Introduction: The complete satisfaction gained from consuming an item or service is known as…

Q: For a utility function for two goods, U(x,y), to have a strictly diminishing MRS (1.e., to be…

A: We are given that for a utility function to have a strictly diminishing MRS, the following condition…

Q: Mr. Dogan has 4000 TL to spend. He considers buying meat whose price is 400 TL per kg. and cheese…

A: Budget Constraint: The cap on spending is defined by income. Usually expressed as an inequality to…

Q: 4.11 CES utility The CES utility function we have used in this chapter is given by U(x, y) =+. a.…

A: b) For showing the Cobb-Douglas case: When δ=0xy=pxpy1/(0-1)=pypxx=pypxyNow putting the value of x…

Q: A) Suppose a quasilinear utility function is given by u(x₁, x₂) = 2√x₁ + 4x₂. 1. For this utility…

A: Utility function shows relationship between utility and inputs. The Engel curve exhibits…

Q: The tables show the utility Parker experienced from consuming varying quantities of waffles and…

A: Parker utility maximization will take place at the point when marginal utility per dollar of waffles…

Q: Suppose that you are given $20,000 to split between two people, Jane and Fred. The income and…

A: Utility means satisfaction. The marginal utility is the utility derived from the consumption of…

Q: When she is maximizing her utility, she will purchase kg of oranges and tuna sandwiches. Your…

A: Suppose the consumer is consuming two goods: X and Y.The consumer will maximize utility at the…

Q: Suppose Naomi consumes two goods: good 1 and good 2. Last year, the price of good 1 was $2.00 and…

A: The concept of CPI can be explained as a tool that helps in evaluating the average change over a…

Q: For the case of two goods, give an example of a utility function U(x1, x2) that represents the…

A: In financial matters, the utility function estimates the government assistance or fulfillment of a…

Concept explainers

Form Utility

The term utility in general refers to the satisfaction earned from usage of a particular product or service. Utility always plays an important role because it influences various important elements like demand & thereby the price of the good or service as well. Though utility is not easy to measure, various types of economic models can be used indirectly. There can be various types of utilities like economic utility, marginal utility, cardinal utility, form utility.

Question

Marginal Utility
MU,
0 $5,000 10,000 15,000
Income
Singer
Marginal Utility
Multiple Choice
MU,
0 $5,000 10,000 15,000
Income
Catalano
Refer to the above diagrams that show identical marginal utility from income curves for Singer and Catalano. If this initial distribution of
$15,000 to Singer and $5,000 to Catalano is altered in favor of greater equality, it may be argued that:
the combined total utility of the two consumers will decline because Catalano has a greater capacity to derive utility from
income than does Singer
incentives to produce will be weakened and total income will decrease..
incentives to produce will be enhanced and total income will increase.
the combined total utility of the two consumers will decline because Singer has a greater capacity to derive utility from
income than does Catalano.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Marginal utility:

VIEW

Step 2: Correct option:

VIEW

Step 3: Incorrect options:

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Ayana is pitching an idea for a startup company that makes and sells solar-powered phonechargers (C). Her market research has found that consumer demand for this product can beexpressed as a function of the price of the charger itself (PC), the price of phones (PF), andthe consmer’s income (I). Consumer demand can be described by the function C(PC, PF, I) =(i−10PC)/ (PF) Suppose her chargers come in all different capacities to meet any quantity demanded, so youdon’t need to worry about restricting C to whole numbers for this problem. (a) Does this product satisfy the law of demand?Explain.
2.
Define the law of diminishing marginal utility. Given an individual’s income and the prices of two or more goods, explain and demonstrate how an individual chooses between the two or more goods in order to maximize total utility. Define the equimarginal principle and explain the logic behind it. Explain how the equimarginal principle can be used to determine the optimal amount of security guards versus helicopters to employ to prevent illegal border crossings.
Suppose that a consumer has the utility function U(X,Y)= 2X 1/2 y 1/2 for X>0 and Y> 0. Which of the following utility functions would not represent the same preferences? U(X,Y)= 2(X + Y) 1/2 U(X,Y)=2x1/2y 1/2 - 100 O U(X,Y)= In 2 + InX+ In Y O U(X,Y)= X 1/2 y 1/2 O U(X, Y) = 4XY
Refer to the graph below Quantity of Y 160 0 Multiple Choice The consumer's income is $1,000 Why doesn't the consumer choose the combination at point B O Quantity of X 200 O The marginal utility of Y exceeds the marginal uplity of X O The consumer is willing to give up more X for an additional unit of Y than must be given up given the relative prices of X and Y. The marginal utility per dollar spent on X exceeds the marginal utility per dollar spent on Y The consumer is willing to give up more Y for an additional unt of X than must be given up given the relative prices of X and Y
The table shows the total utility data for products S and T. Assume that the prices of S and T are $3 and $5, respectively, and that consumer income is $22. Total Utility 12 27 39 48 51 Units of S 1 2 3 4 5 Multiple Choice If the price of T decreases from $5 to $3, while the price of S and the consumer's income stay the same, then the utility-maximizing combination is such that the quantity of T increases from 2 to 4. Units of T 1 2 3 4 5 Total Utility 20 35 45 50 52 decreases from 4 to 3. stays the same at 2, but the consumer has $1 remaining. increases from 2 to 3, but the consumer has $1 remaining.
Gino derives utility from only two goods, carrots (Qc) and donuts (Qd). His utility function is as follows:U(Qc,Qd) = (Qc)(Qd)The marginal utility that Donald receives from carrots (MUc) and donuts (MUd) are given as follows:MUc = Qd MUd = QcGino has an income (I) of £120 and the price of carrots (Pc) and donuts (Pd) are both £1. - what is Gino's budget line and what quantities of Qc and Qd will maximise Gino's utitlity? - holding income and Pd constant, what is Gino's demand curve for carrots? - suppose a tax of 1 pound per unit is levied on donuts. how will this alter Gino's utility maximisinzing market basket of goods?