Which of the following statements regarding utility is not true?
Utility is a subjective concept and varies from person to person, at different times and at different places. There cannot be a standardised measure for utility. Therefore, the point that utility always measurable is not true.
Which of the following utility approach is based on the theory of Alfred Marshall?
Alfred Marshall was the dominant figure in British economics from about 1890 until his death in 1924.His specialty was microeconomics—the study of individual markets and industries, as opposed to the study of the whole economy.
It was Alfred Marshall who first discussed the role played by the theory of utility in the theory of value. In Marshall's theory, the concept of utility is cardinal.
_____________ is the addition to total utility by the consumption of one additional unit of the commodity?
Which of the following utility approach suggests that utility is a measurable and quantifiable entity?
In cardinal utility approch utility is measured in numerical terms.And unit used for measurement is known as utils.
____________ shows various combinations of two goods that give same amount of satisfaction to the consumer?
On indifference curve,consumer gets same satisfaction from each combination hence he is indifferent towards all combinations.
Indifference curve slopes___________?
In order to increase the consumption of one good,other good must be sacrificed as utility level through out the indifference cure has to be same.Due to inverse relation between two goods indifference curve slopes downwards from left to right.
_____________ is defined as the difference between what the consumer is willing to pay for a product and what he actually pays?
Consumer surplus happens when the price consumers pay for a product or service is less than the price they're willing to pay. Consumer surplus is the benefit or good feeling of getting a good deal.
Consumer surplus always increases as the price of a good falls and decreases as the price of a good rises.
According to the law of diminishing marginal utility, _________?
As per law of dimnishing marginal utility, as the consumer goes on conuming MU derived from each succesive unit goes on falling,becomes zero and finally turns negative
The want satisfying power of a commodity is known as:
utility represents satisfaction experienced by the consumer from a good.
What is called point of satiety?
Point of Satiety is defined as '' the point where marginal utility of any commodity is zero''. Thus it is a point where satisfaction of any commodity is zero.
The total utility divided by the number of units consumed is known as?
Average utility is nothing but utility derived by per unit of consumption.
Utility is measured in terms of?
Measurement unit for utility is known as utils.
The concept of marginal utility was developed by?
MU is the concept used in cardianl utility approch which was given by alferd marshal.
Indifference curve represents?
An indifference curve is a graph showing combination of two goods that give the consumer equal satisfaction and utility.
Consumer’s surplus is also known as?
Consumer surplus, also called social surplus and consumer's surplus, in economics, the difference between the price a consumer pays for an item and the price he would be willing to pay rather than do without it.
An indifference curve is always?
In the case of normal goods indifference curve is always convex.
According to Marshall, the law of diminishing marginal utility applies on ___________?
As per Alferd marshall MU of money is constant.
Consumer’s equilibrium means?
consumer equilibrium is a state of balance for the consumer from where he doesn’t want to move either forward or backward. This is achieved when consumer gets maximum satisfaction with given income and he doesn’t want to change his way of existing expenditure.
MU1 + MU2 + ……..MUn represents?
Total utility is the total satisfaction received from consuming a given totalquantity of a good or service. It is the sum of marginal utility which can be expressed as:
TU = (MU1 + MU2+ ............ MUn)
A budget constraint line is a result of?
A budget constraint represents all the combinations of goods and services that a consumer may purchase given current prices within his or her given income. Consumer theory uses the concepts of a budget constraint and a preference map to analyze consumer choices.
An indifference curve indicates, ceteris paribus?
An indifference curve is a graph showing combination of two goods that give the consumer equal satisfaction and utility. Each point on an indifference curve indicates that a consumer is indifferent between the two and all points give him the same utility.
The coefficient of price elasticity of demand is always
There is a negative relation between price of the commodity and its quantity demanded,due to which elasticity coffecient is always negative.
Utility of a good can be explained as a?
Utility represents satisfaction experienced by the consumer from a good.
Which of the following statements regarding ordinal utility is true?
The Ordinal Utility approach is based on the fact that the utility of a commodity cannot be measured in absolute quantity, but however, it will be possible for a consumer to tell subjectively(by ranking) whether the commodity derives more or less or equal satisfaction when compared to another.
Which of the following curve has a negative slope and cannot interest each other?
IC slopes downward because as the consumer increases the consumption of one commodity, he has to give up certain units of other commodity in order to maintain the same level of satisfaction.
two indifference curves represent two different levels of satisfaction. If these indifference curves intersect each other, the intersection will represent same level of satisfaction, which is impossible.