The Theory of Consumer Behaviour – Questions and Answers

Subject Title: Economics Revision Kit

TOPIC: The Theory of Consumer Behaviour

QUESTION 1
April 2022 Question One C
Outline four determinants of the elasticity of supply. (4 marks)

QUESTION 2
December 2021 Question Two B
Using indifference curve analysis, derive the engel curve of a normal good. (8 marks)

QUESTION 3
August 2021 Question Four B
With the help of a diagram, explain the marginal efficiency of capital. (5 marks)

QUESTION 4
May 2021 Question Three A
Using indifference curve analysis, demonstrate how an individual’s equilibrium point is attained. (4 marks)

QUESTION 5
May 2021 Question Three B
With particular interest on inferior goods, use the indifference curve analysis to demonstrate and explain the income and substitution effect of a fall in price. (6 marks)

QUESTION 6
November 2020 Question Two A
With the help of a diagram, discuss the concept of an individual angel curve as applied in the theory of consumer behaviour. (5 marks)

QUESTION 7
November 2019 Question One C
With the help of a diagram, illustrate the concept of surplus as applied in the theory of market equilibrium. (5 marks)

QUESTION 8
November 2019 Question Three A
Highlight four assumptions of consumer rationality. (4 marks)

QUESTION 9
May 2019 Question Three A
(i) Explain the difference between the “cardinal approach” and the “ordinal approach” to measuring utility. (2 marks)
(ii) Outline four limitations of the cardinal approach to measuring utility. (4 marks)

QUESTION 10
November 2018 Question Three B
Examine six applications of indifference curve analysis in an economy. (6 marks)

QUESTION 11
May 2018 Question Four A
With the aid of a well labelled diagram, explain the law of diminishing marginal utility.
(6 marks)
QUESTION 12
May 2018 Question Four B
Outline four properties of indifference curves. (4 marks)

QUESTION 13
May 2018 Question Five D
With the aid of a diagram, explain why isoquants are negatively sloped. (5 marks)

QUESTION 14
November 2017 Question One B
Highlight three exceptions to the law of diminishing marginal utility. (3 marks)

QUESTION 15
November 2017 Question Four B
Using appropriate illustrations, describe consumer equilibrium under the following approaches to the theory of consumer behaviour:
(i) Cardinal approach. (5 marks)
(ii) Ordinal approach. (5 marks)

QUESTION 16
November 2017 Question Six A
With the aid of a diagram, explain the term “surplus” as applied in the theory of market equilibrium (6 marks)

QUESTION 17
May 2017 Question One C
Using indifference curve analysis, derive the Engel’s curve of a normal good.
(6 marks)
QUESTION 18
May 2017 Question Three B
Outline four limitations of the cardinal approach to the theory of consumer behaviour.
(4 marks)
QUESTION 19
November 2016 Question One C
With the aid of a diagram, explain the concept of consumer surplus. (5 marks)

QUESTION 20
May 2016 Question one A
Outline four assumptions underlying consumer equilibrium. (4 marks)

QUESTION 21
September 2015 Question Five A
Using the indifference curve margins, discuss how the consumer’s equilibrium is obtained. Use an appropriate diagram to illustrate your answer. (6 marks)

QUESTION 22
September 2015 Question Five B
With the help of well-illustrated diagrams, draw the substitution effect and income effect of:
(i) A normal good.
(ii) An inferior good. (8 marks)

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