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Chapter 20: Q. 10 (page 452)

Draw a marginal utility curve corresponding to the total utility curve depicted in Problem 20-9.

Short Answer

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Step by step solution

01

   Introduction

Changes in total utility are used to calculate a marginal utility curve. Changes in the total utility curve determine the slope of the marginal utility curve. A marginal utility curve is depicted graphically in the diagram below.

The marginal utility curve slopes downhill from left to right, as seen in the diagram above. When the total utility reaches its maximum, the marginal utility falls to zero.

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Most popular questions from this chapter

The marginal utility that an individual would experience if she were to consume the first unit of a digital app is 15 utils, and the marginal utility that she would experience if she were to consume a second unit is 18 utils. If one app is the amount that the individual decides to consume, what is the person's total utility?

If the fee charged to a client for legal service is $800per hour and the marginal utility from that service is 1,600units of additional utility, what is the client's hourly marginal utility per dollar for other purchased items?

At a consumer optimum involving goods Aand B, the marginal utility of good Ais 2utils, and the marginal utility of good Bis 8utils. How much greater or smaller is the price of good B compared with the price of good A?

Suppose that you observe that total utility rises as more of an item is consumed. What can you say for certain about marginal utility? Can you say for sure that it is rising or falling or that it is positive or negative?

At the optimal quantities of digital apps and portable power banks determined in your answer to Problem 20-21, after rounding to the nearest 10 cents, is the $ 26 income all spent at the new consumer optimum?
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