Free Practice Quiz Question List

2 Preferences and Indifference Curves Online Quiz Questions

Use this free practice quiz with 20 questions to review 2 Preferences and Indifference Curves, test your knowledge, and prepare for your next test or exam.

20 questions

True or false

1 point

If a bundle has utility 10 and another has utility 5, does this alone establish that the first gives the consumer twice as much satisfaction?

A
True
B
False

Choose one

1 point

A consumer can compare two bundles and regards them as equally good. Which statement best describes how this relates to completeness?

A
The consumer must strictly prefer one bundle to the other.
B
The consumer can rank the bundles in at least one direction, possibly regarding them as equally good.
C
The consumer must assign each bundle a measurable amount of satisfaction.
D
The consumer must prefer whichever bundle contains more of one selected good.

Written response

1 point

In preference notation, what relation is represented by $x\succeq y$ ? Name the relation, not its symbol.

Fill in the blank

1 point

If $x\succeq y$ and $y\succeq z$ , transitivity implies that $x$ is $z$ .

Choose one

1 point

What does an indifference curve represent for a consumer?

A
All bundles that have the same quantity of each good.
B
All bundles the consumer can afford at a given income.
C
All bundles equally preferred to a particular bundle.
D
All bundles that contain more of every good than a particular bundle.

True or false

1 point

Under the assumption that more of each of two goods is preferred to less, an ordinary indifference curve slopes downward.

A
True
B
False

Choose one

1 point

Under which assumption can a consumer conclude that bundles on a higher indifference curve are better than bundles on a lower curve?

A
Monotonicity, or the assumption that more of each good is preferred to less.
B
Completeness, because every pair of bundles can be compared.
C
Continuity, because small changes do not cause abrupt ranking jumps.
D
Transitivity, because rankings are consistent across comparisons.

Written response

1 point

A consumer is indifferent between bundles $A=(2,10)$ and $B=(4,6)$ , where the first coordinate is sandwiches and the second is coffees. How many coffees does the consumer give up per additional sandwich in this comparison?

Fill in the blank

1 point

Continuity assumes that small changes in a bundle do not cause in preference rankings.

Choose all

1 point

Which assumptions are identified as commonly used in consumer theory beyond completeness and transitivity? Select all correct choices.

A
Preferences are monotonic.
B
Preferences are convex.
C
Preferences are continuous.
D
Preferences are complete.
E
Preferences are transitive.

Choose one

1 point

Two indifference curves are meant to represent different preference levels. Why can they not cross?

A
Completeness requires that every curve contain every possible bundle.
B
A shared bundle would, through transitivity of indifference, equate bundles assigned to different preference levels.
C
A crossing would violate the assumption that more of every good is better.
D
The curves would have different slopes at the crossing point.

Choose all

1 point

Which statements about convex preferences and indifference curves are correct? Select all correct choices.

A
If two bundles are equally preferred, a balanced combination is at least as good as the extremes.
B
Strictly convex preferences favor a mixture strictly over either of two distinct, equally preferred endpoints.
C
Convexity requires every indifference curve to be smoothly bowed toward the origin.
D
Perfect substitutes can have straight indifference curves, while perfect complements can have kinked ones.

Open ended

1 point

Explain the difference between monotonicity and nonsatiation. What does monotonicity require that nonsatiation does not?

True or false

1 point

If preferences are continuous, indifference curves must be smooth.

A
True
B
False

Choose one

1 point

A consumer compares two unfamiliar bundles and regards them as equally good. Which assumption about preferences is consistent with being able to make this comparison without strictly preferring either bundle?

A
The consumer must strictly prefer one bundle to the other.
B
The consumer must assign a measurable satisfaction score to each bundle.
C
The consumer can identify one bundle as at least as good as the other, or regard them as equally good.
D
The consumer must prefer a bundle containing more of every good.

Written response

1 point

For bundles $x$ and $y$ , suppose $x\succeq y$ and $y\succeq x$ . What is the name of the relation between the bundles?

Choose one

1 point

A consumer's preferences are transitive. If $x\succeq y$ and $y\succeq z$ , which ranking must also hold?

A
If $x\succeq y$ and $y\succeq z$ , then $z\succeq x$ .
B
If $x\succeq y$ and $y\succeq z$ , then $x\succeq z$ .
C
If $x\succeq y$ , then the consumer must strictly prefer $x$ to $y$ .
D
If $x\succeq y$ and $y\succeq x$ , then the consumer must strictly prefer both bundles.

Choose one

1 point

A consumer's indifference map has two curves, one northeast of the other. Which additional assumption supports concluding that bundles on the northeast curve are preferred?

A
Monotonicity: with more of both goods, the bundle is preferred.
B
Completeness alone: every pair of bundles can be compared.
C
Continuity: small changes do not cause abrupt jumps in preference rankings.
D
Convexity alone: balanced combinations are at least as good as the extremes.

Choose one

1 point

Two indifference curves are said to represent different preference levels. Why can they not cross?

A
Crossing curves would violate the assumption that more of each good is preferred.
B
Crossing curves would imply that utility numbers measure satisfaction in absolute units.
C
Crossing curves would show that the consumer cannot compare the bundles.
D
A shared bundle would make bundles on the two curves indifferent to one another, contradicting their representing different preference levels.

Written response

1 point

A consumer is indifferent between bundle $A=(2,10)$ and bundle $B=(4,6)$ , where the first coordinate is sandwiches and the second is coffees. In this comparison, how many coffees does the consumer give up per additional sandwich?

2 Preferences and Indifference Curves Online Quiz Questions

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