Chapter 7: Problem 36

If food were free in your school cafeteria, you would keep eating until (LO2) a) your total utility was zero b) your marginal utility was zero c) your consumer surplus was zero d) you were sick

Short Answer

Expert verified

The short answer is: The consumer would keep eating until their \(marginal \ utility\) was zero (option B). This occurs because, as the consumer consumes more food, the additional satisfaction (marginal utility) decreases until it reaches zero, which is when consuming another unit of food will not provide any additional satisfaction.

Step by step solution

Total Utility

: Total utility refers to the overall satisfaction an individual receives from consuming a certain amount of goods or services. As the individual continues to consume more goods or services, their total utility increases, but the additional satisfaction gained from each additional unit (marginal utility) decreases.

Marginal Utility

: Marginal utility is the utility derived from consuming one additional unit of a good or service. The Law of Diminishing Marginal Utility states that as one continues to consume more goods, the marginal utility of that good decreases.

Consumer Surplus

: Consumer surplus is the difference between the maximum price a consumer is willing to pay and the actual price the consumer ends up paying. In this scenario, since the food is free, the consumer surplus is equal to the price the consumer would have been willing to pay for the food. Now, let's analyze the four given options and choose the most accurate one.

Option A: Total Utility is Zero

: This option is incorrect because if total utility is zero, it means that the consumer receives no satisfaction from consuming the goods. In this case, as long as the consumer is eating and enjoying the free food, their total utility will not be zero.

Option B: Marginal Utility is Zero

: This option is correct. As the consumer continues to eat and consume more food, the additional satisfaction they receive from consuming the next unit (marginal utility) decreases. Eventually, the marginal utility will reach zero, meaning that consuming another unit of food will not provide any additional satisfaction. This is the point at which the consumer would choose to stop eating.

Option C: Consumer Surplus is Zero

: This option is incorrect. As long as the consumer is enjoying the free food, there will always be a positive consumer surplus, as they would have been willing to pay some price for the food, but received it for free.

Option D: You were sick

: This option is irrelevant to the concepts of utility and consumer surplus. Feelings of sickness do not directly relate to the economic concepts discussed. Based on the analysis of provided options, the correct choice is option B, suggesting that the consumer would keep eating until their marginal utility was zero.

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