-
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 90 Discrimination
Index: 10
Correct Answer: False
2.1 If there are two goods with
positive prices and the price of one good is
reduced, while
income
and
other prices remain constant, then the size of the
budget set is reduced.
Topic: Budget
Constraint Di_culty: 1
% Correct
Responses: 76 Discrimination Index: 24
Correct Answer: False
2.2 If
good 1 is measured on the horizontal axis and good
2 is measured on the vertical
axis, and
if the price of good 1 is p1 and the
price of good 2 is p2; then the slope of the
budget line is
p2=p1.
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 91 Discrimination
Index: 13
Correct Answer: False
2.3 If all prices are doubled and money
income is left the same, the budget set does not
change
because relative
prices don't change.
Topic: Budget
Constraint Di_culty: 1
% Correct
Responses: 93 Discrimination Index: 21
Correct Answer: True
2.4 If
there are two goods, and if one good has a
negative price and the other has a
positive
price, then the
slope of the budget line will be positive.
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 94 Discrimination
Index: 12
Correct Answer: False
2.5 If all prices double and income
triples, then the budget line will become steeper.
CHAPTER 2 Budget Constraint 2
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 95 Discrimination
Index: 13
Correct Answer: False
2.6 If Good 1 is on the horizontal axis
and Good 2 is on the vertical axis, then an
increase
in the
price of
Good 1 will not change the horizontal intercept of
the budget line.
Topic: Budget
Constraint Di_culty: 1
% Correct
Responses: 98 Discrimination Index: 1
Correct Answer: False
2.7 If
there are two goods and the prices of both goods
rise, then the budget line must
become
steeper.
Topic: Budget
Constraint Di_culty: 1
% Correct
Responses: 97 Discrimination Index: 0
Correct Answer: True
2.8
There are two goods. You know how much of good 1 a
consumer cana_ord if she
spends all
of her income on good 1. If you know
the ratio of the prices of the two goods, then you
could draw
the consumer's
budget line without any more information.
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 91 Discrimination
Index: 0
Correct Answer: True
2.9 A consumer prefers more to less of
every good. Her income rises, and the price of one
of the
goods falls while
other prices stay constant. These changes must
have made her better
o_.
Topic: Budget Constraint Di_culty: 2
% Correct Responses: 0 Discrimination
Index: 0
Correct Answer: True
2.10 There are 3 goods. The price of
good 1 is
1; the price of
good 2 is +1; and the price
of good 3
is +2. It is physically possible for a consumer to
consume any commodity bundle
with
non-negative amounts of each good. A
consumer who has income of 10 could a_ord to
consume
some commodity
bundles that include 5 units of good 1 and 6 units
of good 2.
Topic: Budget Constraint
Di_culty: 1
% Correct Responses: 80
Discrimination Index: 49
Correct
Answer: False
2.11 A decrease in income
pivots the budget line around the bundle initially
consumed.
Multiple Choice Budget
Constraint
Topic: Budget Constraint
Di_culty: 1
% Correct Responses: 97
Discrimination Index: 6
Correct Answer:
A
2.1
If she spends all of
her income on lemons and tangerines, Isabella can
just a_ord 30
lemons and
8
tangerines per day. She could also use her entire
budget to buy 6 lemons and 14
tangerines per
day. The
price of lemons is 6 guineas each. How much is
Isabella's income per day?
(a) 372
guineas
(b) 377 guineas
(c)
371 guineas
(d) 363 guineas
(e) None of the above.
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 97 Discrimination
Index: 6
Correct Answer: A
2.2
If she spends all of her
income on uglifruit and breadfruits, Maria can
just a_ord 11 uglifruit
and 4
breadfruits per day. She could also use her entire
budget to buy 3 uglifruit and 8
breadfruits
per day. The
price of uglifruit is 6 pesos each. How much is
Maria's income per day?
(a) 115 pesos
(b) 119 pesos
(c) 114 pesos
(d) 105 pesos
(e) None of
the above.
CHAPTER 2 Budget Constraint
4
Topic: Budget Constraint Di_culty: 2
% Correct Responses: 0 Discrimination
Index: 0
Correct Answer: A
2.3 Matt lives on popcorn and seafood
salads. The price of popcorn is 1 dollar per bag
and
the
price of seafood
salads is 2 dollars each. Matt allows himself to
spend no more than 13
dollars a
day on food. He also restricts his
consumption to 5,500 calories per day. There are
1,000
calories
in a bag of
popcorn and 500 calories in a seafood salad. If he
spends his entire money
budget each
day and consumes no more calories than
his calorie limit:
(a) he can consume
up to 3 bags of popcorn per day, but no more.
(b) he can consume up to 1 bags of
popcorn per day, butno more.
(c) he can
consume up to 5 seafood salads per day, but no
more.
(d) he can consume up to 4 bags
of popcorn per day, but no more.
(e)
None of the above.
Topic: Budget
Constraint Di_culty: 2
% Correct
Responses: 0 Discrimination Index: 0
Correct Answer: A
2.4 Quincy
lives on ding dongs and seafood salads. The price
of ding dongs is 1 dollar per
bag
and the price of seafood salads is 4
dollars each. Quincy allows himself to spend no
more
than 23
dollars a day
on food. He also restricts his consumption to
3,300 calories per day. There
are 600
calories in a bag of ding dongs and 300
calories in a seafood salad. If he spends his
entire
money
budget each day
and consumes no more calories than his calorie
limit:
(a) he can consume up to 3 bags
of ding dongs per day, but no more.
(b)
he can consume up to 1 bags of ding dongs per day,
butno more.
(c) he can consume up to 5
seafood salads per day, but no more.
(d) he can consume up to 4 bags of ding
dongs per day, but no more.
(e) None of
the above.
MULTIPLE CHOICE 5
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 88 Discrimination
Index: 20
Correct Answer: A
2.5 Teresa spends her entire budget and
consumes 6 units of x and 20 units of y. The
price of x
is twice the
price of y. Her income doubles and the price of y
doubles, but the price of x
stays the
same. If she continues to buy 20 units
of y; what is the largest number of units of x
that
she can
a_ord?
(a) 12
(b) 6
(c)
14
(d) 16
(e) There is not
enough information to say.
Topic:
Budget Constraint Di_culty: 1
% Correct
Responses: 88 Discrimination Index: 20
Correct Answer: A
2.6 Linda
spends her entire budget and consumes 15 units of
x and 19 units of y. The
price of x
is twice the price of y. Her income
doubles and the price of y doubles, but the price
of x
stays the
same. If she
continues to buy 19 units of y; what is the
largest number of units of x that
she
can
a_ord?
(a) 30
(b) 15
(c) 32
(d)
34
(e) There is not enough information
to say.
Topic: Budget Constraint
Di_culty: 1
% Correct Responses: 50
Discrimination Index: 50
Correct
Answer: C
2.7 In year 1, the price of
good x was 1, the price of good y was 1, and
income was 30. In
year
2,
the price of x was 6, the price of good y was 5,
and income was 30. On a graph with x
on
the
horizontal axis and y on the
vertical, the new budget line is:
(a)
atter than the old one and lies below it.
(b) atter than the old one and lies
above it.
(c) steeper than the old one
and lies below it.
(d) steeper than the
old one and lies above it.
(e) none of
the above.
CHAPTER 2 Budget Constraint
6
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 50 Discrimination
Index: 50
Correct Answer: C
2.8 In year 1, the price of good x was
4, the price of good y was 2, and income was 60.
In
year
2, the price of x
was 17, the price of good y was 8, and income was
60. On a graph with x
on the
horizontal axis and y on the vertical,
the new budget line is:
(a) atter than
the old one and lies below it.
(b)
atter than the old one and lies above it.
(c) steeper than the old one and lies
below it.
(d) steeper than the old one
and lies above it.
(e) none of the
above.
Topic: Budget Constraint
Di_culty: 1
% Correct Responses: 35
Discrimination Index: 8
Correct Answer:
D
2.9
If she spends her
entire budget, Vanessa cana_ord 47 apricots and 10
cherries. She can
also just
a_ord 20 apricots and 19 cherries. The
price of apricots is 18 cents. What is the price
of
cherries
in cents?
(a) 64
(b) 3
(c)
21
(d) 54
(e) None of the
above.
MULTIPLE CHOICE 7
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 35 Discrimination
Index: 8
Correct Answer: D
2.10
If she spends her
entire budget, Heidi cana_ord 39 peaches and 12
pears. She can also
just a_ord
24 peaches and 17 pears. The price of
peaches is 9 cents. What is the price of pears in
cents?
(a) 37
(b)
3
(c) 12
(d) 27
(e) None of the above.
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 100 Discrimination
Index: 0
Correct Answer: B
2.11 Heidi thrives on two goods:
bananas and apples. The cost of bananas is 30
marks
each and
the cost of
apples is 15 marks each. If her income is 210
marks, how many bananas can
she buy if
she spends all of her income on
bananas?
(a) 5
(b) 7
(c) 14
(d) 10
(e)
None of the above
Topic: Budget
Constraint Di_culty: 1
% Correct
Responses: 100 Discrimination Index: 0
Correct Answer: B
2.12
Teresa thrives on two goods: mangos and melons.
The cost of mangos is 30 yen
each and
the cost of melons is 15 yen each. If
her income is 180 yen, how many mangos can she
buy if she
spends all of her
income on mangos?
(a) 4
(b)
6
(c) 12
(d) 9
(e) None of the above
CHAPTER 2 Budget Constraint 8
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 76 Discrimination
Index: 34
Correct Answer: B
2.13 Yoram spends his entire income on
11 sacks of acorns and 5 crates of butternuts.
The price
of acorns is 4
dollars per sack and his income is 94 dollars. He
can just a_ord a
commodity bundle
with A sacks of acorns and B crates of
butternuts which satis_es the budget equation:
(a) 4A+ 12B = 94.
(b) 8A+
20B = 188.
(c) 6A + 10B = 94.
(d) 4A+ 14B = 96.
(e) None
of the above.
Topic: Budget Constraint
Di_culty: 1
% Correct Responses: 76
Discrimination Index: 34
Correct
Answer: B
2.14 Eduardo spends his
entire income on 12 sacks of acorns and 2 crates
of butternuts.
The
price of
acorns is 2 dollars per sack and his income is 34
dollars. He can just a_ord a
commodity
bundle with A sacks of acorns and B
crates of butternuts which satis_es the budget
equation:
(a) 2A+ 7B = 34.
(b) 4A+ 10B = 68.
(c) 4A +
5B = 34.
(d) 2A+ 9B = 36.
(e) None of the above.
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 99 Discrimination
Index: 5
Correct Answer: C
2.15 Harry thrives on two goods,
paperback novels and bananas. The cost of
paperback
novels
is 4
dollars each and the cost of bananas is 3 dollars
per Harry spent all of his
income on
bananas, he could a_ord 12 bunches of
bananas per week. How many paperback novels
could he
buy if he spent all
of his income on paperback novels?
(a)
36
(b) 48
(c) 9
(d) 16
(e) None of the
above.
MULTIPLE CHOICE 9
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 92 Discrimination
Index: 25
Correct Answer: E
2.16 Suppose that the prices of good x
and good y both double, and income triples. On a
graph
where the budget line
is drawn with x on the horizontal axis and y on
the vertical axis:
(a) the budget line
becomes steeper and shifts inward.
(b)
the budget line becomes atter and shifts outward.
(c) the budget line becomes atter and
shifts inward.
(d) the new budget line
is parallel to the old budget line and lies below
it.
(e) None of the above.
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 96 Discrimination
Index: 18
Correct Answer: D
2.17 Suppose that the price of good x
triples and the price of good y doubles while
income
remains constant. On a graph
where the budget line is drawn with x on the
horizontal axis
and y
on the
vertical axis, the new budget line:
(a)
isatter than the old one and lies below it.
(b) isatter than the old one and lies
above it.
(c) crosses the old budget
line.
(d) is steeper than the old one
and lies below it.
(e) is steeper than
the old one and lies above it.
Topic:
Budget Constraint Di_culty: 3
% Correct
Responses: 0 Discrimination Index: 0
Correct Answer: C
2.18 While
traveling abroad, Tammy spent all of the money in
her purse to buy 5 plates of
spaghetti
and 6 oysters. Spaghetti costs 8 units of the
local currency per plate and she
had 82
units
of currency in her purse. If s
denotes the number of plates of spaghetti and o
denotes the
number
of
oysters purchased, the set of commodity bundles
that she could just a_ord with the
money in
her purse is
described by the equation:
(a) 82 + 6o
= 82.
(b) 6s + 8o = 82.
(c)
8s+ 7o = 82.
(d) 5s + 6o = 82.
(e) There is not enough information to
determine the answer.
CHAPTER 2 Budget
Constraint 10
Topic: Budget Constraint
Di_culty: 2
% Correct Responses: 0
Discrimination Index: 0
Correct Answer:
B
2.19 Billy Bob wants to gain some
weight so that he can play football. Billy eats
only
milkshakes
and spinach.
Milkshakes cost him $$1 each and spinach costs $$2
per serving. A milkshake
has 850
calories and a serving of spinach has
200 calories. Billy Bob never spends more than $$20
a day on
food and he always
consumes at least 8000 calories per day. Which of
the following is
necessarily
true?
(a) Billy Bob consumes
at least 9 milkshakes a day.
(b) Billy
Bob never consumes more than 6 servings of spinach
a day.
(c) Billy Bob never consumes
positive amounts of both goods.
(d)
Billy Bob consumes only milkshakes.
(e)
None of the above.
Topic: Budget
Constraint Di_culty: 2
% Correct
Responses: 81 Discrimination Index: 21
Correct Answer: D
2.20 Lars
consumes only potatoes and herring. When the price
of potatoes was 9 crowns
per
sack and the price of herring was 5
crowns per crock, he spent his entire income to
buy 5
sacks of
potatoes and
10 crocks of herring per month. Now the government
subsidizes potatoes.
Market
prices haven't changed, but consumers
get a subsidy of 5 crowns for every sack of
potatoes con-
sumed. To pay
for this subsidy, the government introduced an
income tax. Lars pays an
income
tax of 20 crowns per month. If s is the
number of sacks of potatoes and c is the number of
crocks
of herring, what is
Lars's NEW budget equation?
(a) 9s+ 5c
= 100.
(b) 14s+ 5c = 95.
(c)
4s+ 5c = 95.
(d) 4s + 5c = 75.
(e) 14s + 5c = 120.
MULTIPLE
CHOICE 11
Topic: Budget Constraint
Di_culty: 1
% Correct Responses: 95
Discrimination Index: 17
Correct
Answer: C
2.21 If you spent your entire
income, you could a_ord either 4 units of x and 8
units of y or
8
units of x
and 4 units of y. If you spent your entire income
on x; how many units of x could
you
buy?
(a) 20
(b) 17
(c) 12
(d) There is not
enough information to determine the amount of x.
(e) None of the above.
Topic: Budget Constraint Di_culty: 1
% Correct Responses: 95 Discrimination
Index: 17
Correct Answer: C
2.22 If you spent your entire income,
you could a_ord either 5 units of x and 15 units
of y
or 15
units of x and 5
units of y. If you spent your entire income on x;
how many units of x could
you buy?
(a) 35
(b) 24
(c)
20
(d) There is not enough information
to determine the amount of x.
(e) None
of the above.
Topic: Budget Constraint
Di_culty: 1
% Correct Responses: 95
Discrimination Index: 10
Correct
Answer: C
2.23 Bella's budget line for
x and y depends on all of the following except: