The Fact That Your Fourth Slice of Pizza Does Not

question 3

Multiple Choice

The fact that your fourth slice of pizza does not generate as much satisfaction as your third slice is an example of

• A)consumer surplus.
• B)diminishing total utility.
• C)diminishing marginal utility.
• D)the paradox of value.
• E)the law of demand.

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Definitions:

Present Value

The current value of a future amount of money or stream of cash flows given a specified rate of return.

Growth Opportunities

The potential for business expansion, revenue increase, or higher profits due to internal strategies or external conditions in the market.

Free Cash Flow

The amount of cash generated by a company after accounting for capital expenditures, essential for maintaining or expanding the asset base.

Terminal Value

The value of an investment or project at the end of a forecast period, considering all future cash flows as a single lump sum value.