-For David, the Marginal Utility from an Additional Car Is

question 37

Multiple Choice

-For David, the marginal utility from an additional car is 2,000 units and the marginal utility from an additional vacation is 1,000 units. David is allocating all of his budget. Hence, to maximise his utility, David will

• A) save his budget by not spending it until he can afford both the car and the vacation.
• B) shift his consumption from the vacation to the car.
• C) buy both the car and the vacation now.
• D) shift his consumption from the car to the vacation.
• E) possibly do something, but there is not enough information available to determine what he would do.

---

Definitions:

Bananas

A type of edible fruit produced by various kinds of large herbaceous flowering plants in the genus Musa, often consumed as a staple food in many parts of the world.

Market Demand

The total level of a product or service that all individuals in a market are disposed and capable of acquiring at multiple price ranges.

Fast Food

Quick-service restaurant offerings that are prepared and served very quickly, often emphasizing affordability and convenience over nutritional value.

Potato Chips

Snack food made from thin slices of potato that are either baked or fried until crispy.