Chapter 20: Q.10 (page 464)
Using your answer to Problem F-8, draw Sue's demand curve for soft drinks.
Short Answer
The demand curve is shown
Chapter 20: Q.10 (page 464)
Using your answer to Problem F-8, draw Sue's demand curve for soft drinks.
The demand curve is shown
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Get started for freeIf the fee charged to a client for legal service is per hour and the marginal utility from that service is units of additional utility, what is the client's hourly marginal utility per dollar for other purchased items?
You determine that your daily consumption of soft drinks is and your daily consumption of tacos is when the prices per unit are cents and , respectively. Explain what happens to your consumption bundle, and, after your consumption choices adjust, to the marginal utility of soft drinks and the marginal utility of tacos, when the price of soft drinks rises to cents.
Take a look at Figure 20-1. Suppose that the individual currently consumes 5 digital apps. What happens to the person's total utility if he were to reduce his consumption to 4 units? Why does this fact imply that the marginal utility curve cuts through the horizontal axis of the panel (c) between the fourth and fifth app consumed?
Consider the movements that take place from one point to the next ( to to and so on) along the total utility curve as the individual successively increases consumption by one more unit, and answer the questions that follow.
a. Which one-unit increase in consumption from one point to the next along the total utility curve gencrates the highest marginal utility?
b. Which one-unit increase in consumption from one point to the next along the total utility curve gencrates zero marginal utility?
c. Which one-unit increase in consumption from one point to the next along the total utility curve generates negative marginal utility?
Distinguish between total and marginal utility and discuss why marginal utility ultimately falls as a person consumes more of an item.
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