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AP Microeconomics Consumer Choices — practice questions

Explore 23 free Consumer Choices questions in AP Microeconomics Economics. Open each question or exercise to read its content, reference answers and available explanation.

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Consumer Choices questions and exercises with answers

Showing questions 1–23 of 23.

Economists analyse decisions about what to buy as choices made within certain:Read the answer and worked solution →In economic terms, consumers are described as trying to maximise their total:Read the answer and worked solution →Total utility is described as the total amount of:Read the answer and worked solution →Marginal utility is defined as the additional utility provided by:Read the answer and worked solution →The law of diminishing marginal utility holds that additional utility does what with each unit added?Read the answer and worked solution →Marginal utility per dollar is the additional utility received divided by the product's:Read the answer and worked solution →The utility-maximizing choice identified by the general rule is called the:Read the answer and worked solution →The substitution effect occurs when a price change gives consumers an incentive to consume less of the good that is:Read the answer and worked solution →Under the substitution effect, consumers consume more of the good that is:Read the answer and worked solution →The income effect describes a higher price as reducing, in effect, the:Read the answer and worked solution →Under the income effect, reduced buying power leads to buying less of a good when the good is:Read the answer and worked solution →With a new budget constraint, a consumer chooses point N if both goods are:Read the answer and worked solution →If overnight stays is an inferior good, the consumer instead makes a choice like:Read the answer and worked solution →A budget constraint line with a rise of minus 8 over a run of 4 has a slope of:Read the answer and worked solution →The negative slope of a budget constraint reflects that buying more of one good means:Read the answer and worked solution →Consumer equilibrium is found by comparing across goods the marginal utility:Read the answer and worked solution →Diminishing marginal utility means the total utility from extra units continues to rise but at a rate that is:Read the answer and worked solution →A price rise for a normal good makes both effects push consumption of that good in which direction?Read the answer and worked solution →Match each consumer choice termRead the answer and worked solution →Tap what belongs to each effectRead the answer and worked solution →True or false: consumer choicesRead the answer and worked solution →Work the budget lineRead the answer and worked solution →Complete the consumer rulesRead the answer and worked solution →

Worked practice questions

Economists analyse decisions about what to buy as choices made within certain:

  1. Budget constraints
  2. Legal restrictions
  3. Cultural traditions
  4. Physical distances
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Correct answer: A. Budget constraints

1. Every purchase decision happens under a limit. 2. Economists believe that we can analyze individuals' decisions. 3. Those include what goods and services to buy. 4. They are choices we make within certain budget constraints. _Source: OpenStax Principles of Microeconomics for AP Courses 2e (CC BY 4.0), Ch 6 'Consumer Choices'_

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In economic terms, consumers are described as trying to maximise their total:

  1. Working
  2. Utility
  3. Income
  4. Savings
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Correct answer: B. Utility

1. Consumers are modelled as pursuing one objective. 2. Consumers make choices within certain budget constraints. 3. In economic terms they are trying to maximize total utility. 4. Total utility is another word for satisfaction. _Source: OpenStax Principles of Microeconomics for AP Courses 2e (CC BY 4.0), Ch 6 'Consumer Choices'_

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Total utility is described as the total amount of:

  1. Satisfaction
  2. Money spent
  3. Time used
  4. Goods sold
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Correct answer: A. Satisfaction

1. Utility is a measure of how well off a consumer feels. 2. A utility table records consumption of a good such as T-shirts. 3. The total utility column shows the total amount of satisfaction. 4. That satisfaction comes from consuming that number of T-shirts. _Source: OpenStax Principles of Microeconomics for AP Courses 2e (CC BY 4.0), Ch 6 'Consumer Choices'_

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Negative ExternalitiesLabor Markets and IncomeMonopolistic Competition and OligopolyPositive Externalities and Public GoodsProduction, Costs and Industry StructureMonopolyChoice in a World of ScarcityElasticity