5 Questions
What is the main objective of a consumer when buying goods and services?
To maximize satisfaction from the quantity of commodities purchased at given market price
What does the term 'consumer's equilibrium' refer to?
The point at which a consumer maximizes satisfaction from spending on goods and services
What is the relationship between total utility and marginal utility?
Total utility increases at a decreasing rate as marginal utility diminishes
What is the economic agent who buys goods and services referred to as?
Consumer
What is the main subject matter of the chapter on consumer's equilibrium?
How a consumer maximizes satisfaction from spending income on goods and services
Study Notes
Consumer Behavior and Equilibrium
- The main objective of a consumer when buying goods and services is to maximize satisfaction or utility.
Consumer's Equilibrium
- Consumer's equilibrium refers to the point at which the total utility derived from consuming a good or service is maximized, and the marginal utility equals zero.
Utility and Satisfaction
- There is a direct relationship between total utility and marginal utility, where total utility increases as marginal utility is positive, and decreases as marginal utility is negative.
Economic Agents
- The economic agent who buys goods and services is referred to as a consumer.
Chapter Overview
- The main subject matter of the chapter on consumer's equilibrium is the analysis of consumer behavior and decision-making processes in allocating limited resources to meet their unlimited wants.
Test your knowledge of consumer behavior and equilibrium with this quiz on consumer's equilibrium. Challenge yourself with questions about consumption, satisfaction, and economic decision-making.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
