Every day, Larry, Curly and Moe go to the same store where each buys three donuts. Therefore, the marginal utility of the third donut is the same for all three of them. T or F ...... False
Why is this false? Have trouble finding insight on the reason behind this answer.
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utility simply means the amount of satisfaction that a consumer receives. marginal utility is the amount of satisfaction that they receieve from consuming one more unit of that good. In terms of eating donuts imagine if you are craving donuts so you go to krispy kreme. NOTHING is better than that first bite of that first donut. it tastes so good right? After the first donut, the level of satisfaction you receive from eating the second one isn't nearly as much as the first, and so on. By the end of the third donut, chances are, you aren't experiencing anymore satisfaction from eating it. In fact, you probably feel kind of sick lol. This is marginal utility. hope I helped
i can work out why you're uncomfortable, its a complicated phraseology. permit's wish its intentional a minimum of. decrease income impacts the call for curve. it truly is going to shift it to the left, meaning that the guy with the very comparable techniques between milk and its substitutes at a given quantity and value will now eat much less quantity at that comparable fee simply by their decreased income. area of it truly is because of the fact all of us comprehend that milk has decrease fee substitutes for the component to it that's had to proceed to exist. If not something modifications, and the provision curve is prevalent upward to the perfect shape, it truly is going to certainly decrease the equilibrium fee. in view that milk is an enter to yogurt, its decreased call for and next low fee will decrease the fee of yogurt. A decrease fee for yogurt will certainly shift the provision curve to the perfect. shop in suggestions that the call for for yogurt is likely to drop with income besides, so the end results of the shift in the provision curve to the perfect must be partly offset by applying the shift in the call for curve to the left. :)