Utility Maximization: Budget Constraints & Consumer Choice

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

When is it rational to throw money in the air with abandon?

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1. How can utility change?

2. What is a sunk cost?

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About This Quiz & Worksheet

These assessments are useful tools for reviewing information you've learned about utility maximization. Quiz questions ask about sunk cost, how utility can change, and utility maximization for consumers.

Quiz & Worksheet Goals

These practice assessments will test you on key aspects of utility maximization including:

  • Determine how utility can change
  • Define sunk cost
  • Identify the highest utility of various scenarios

Skills Practiced

This quiz and worksheet allow you to practice following skills:

  • Reading comprehension - ensure that you draw the most important information from the related lesson
  • Information recall - access the knowledge you've gained regarding utility maximization
  • Knowledge application - use your knowledge to answer questions to assess utilities

Additional Learning

To learn more about utility maximization, review the accompanying lesson titled Utility Maximization: Budget Constraints & Consumer Choice. This lesson covers the following objectives:

  • Define utility
  • Examine the benefits of utility maximization for consumers
  • Understand the effects of ignoring utility maximization
  • View real-world examples of utility maximization
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