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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

Expert verified

a marginal utility curve corresponding to the total utility curve has been drawn.

Step by step solution

01

Given Information

Marginal utility is the additional fulfilment a shopper gets from having another unit of a decent or administration. The idea of marginal utility is utilized by financial analysts to decide the amount of a thing buyers will buy. The law of decreasing marginal utility is frequently used to legitimize moderate charges.

02

Explanation

We know,

Marginal utility is calculated by

Marginal Utility=Change in No, of Units ConsumedChange in Total Utility=∆T∆Q

We get the table,

Drawing the graph from the values we have,

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Most popular questions from this chapter

Refer to the following table for a different consumer, and assume that each week this consumer buys only weckly subscriptions to ceonomic statistics apps and subscriptions to office productivity apps. The price of a subscription to each type of economic statistics app is \(2per week, and the price of a subscription to each office productivity app is \)60per week. If the consumer's available income is $128per week, what quantity of each item will the individual purchase each week at a consumer optimum?

Illustrate Sue's new budget constraint and indifference curve in a diagram from the data in Problem F-3. Illustrate also the utility-maximizing combination of goods.

Describe the substitution and real-income effects of a price change.

As an individual consumes more units of an item, the person eventually experiences diminishing marginal utility. This means that to increase marginal utility, the person must consume less of an item. Explain the logic of this behavior using the example in Problem 20-1.

Take a look at Table 20-1. Suppose that the price of each digital app rises to \( 5.97. At the same time, the price of each portable power bank falls to \) 2.70. Income remains unchanged at $ 26. Rework the marginal-utility-per-dollars-spent columns and round each amount to the nearest one-tenth. What are the quantities of digital apps and portable power banks now purchased by this consumer?
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