Asked by bryan chavez on Jun 05, 2024
Verified
While eating at Alex's "Pizza by the Slice" restaurant,Kara experiences diminishing marginal utility.She gained 10 units of satisfaction from her first slice of pizza consumed and would only receive 5 units of satisfaction from consuming a second slice,at the same price.Based on this information we can conclude that:
A) Alex may have to lower the price to convince Kara to buy a second slice.
B) Kara will not eat a second slice,even if it is given to her at no charge.
C) Kara will definitely want to buy a second slice of pizza.
D) even if Kara buys a second slice,she will not buy a third slice.
Diminishing Marginal Utility
See Law of Diminishing Marginal Utility.
Satisfaction
The contentment one feels when one's needs, desires, or expectations are fulfilled or surpassed.
- Interpret the principle behind declining marginal utility.
- Evaluate scenarios using the law of diminishing marginal utility to explain consumer behavior.
Verified Answer
CP
Camila PradoJun 12, 2024
Final Answer :
A
Explanation :
Kara experiences diminishing marginal utility, meaning that each additional slice of pizza consumed will provide less satisfaction than the previous one. Therefore, in order to convince Kara to buy a second slice, Alex may have to lower the price to make it more appealing.
Learning Objectives
- Interpret the principle behind declining marginal utility.
- Evaluate scenarios using the law of diminishing marginal utility to explain consumer behavior.