Consumer Behavior Quiz
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Questions and Answers

What does consumer theory suggest about consumption decisions?

  • Consumers make decisions based on minimizing their costs
  • Consumers make decisions randomly
  • Consumers make decisions based on peer influence
  • Consumers make decisions based on maximizing their satisfaction (correct)

    • What do consumption bundles represent?

  • Different combinations of goods and services (correct)
  • Different pricing strategies
  • Different levels of utility
  • Different types of consumers

    • Which term refers to an individual's pleasure, happiness, or satisfaction?

  • Marginal utility
  • Consumer behavior
  • Utility (correct)
  • Total utility

    • What is the total utility?

    <p>The total amount of satisfaction</p> Signup and view all the answers

    According to consumer theory, why do individuals make consumption decisions?

    <p>To maximize their satisfaction</p> Signup and view all the answers

    What does an indifference curve show?

    <p>The level of satisfaction from consuming two commodities</p> Signup and view all the answers

    What is the purpose of an indifference curve in consumer theory?

    <p>To show the relationship between two commodities</p> Signup and view all the answers

    What does the law of diminishing marginal utility state?

    <p>As consumption increases, marginal utility decreases</p> Signup and view all the answers

    What is the unit of measurement for cardinal values in consumer theory?

    <p>Util</p> Signup and view all the answers

    What is the difference between total utility and marginal utility?

    <p>Total utility is the overall satisfaction, while marginal utility is the additional satisfaction from consuming one more unit</p> Signup and view all the answers

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