-The Table Above Gives Ali's Total Utility from Consuming Bottles

question 74

Multiple Choice

-The table above gives Ali's total utility from consuming bottles of soft drink and slices of pizza. The price of pizza is $2 per slice and the price of soft drink is $1 per bottle. His marginal utility from the 4th slice of pizza is

• A) 34.
• B) 17.50.
• C) 7.
• D) 3.50.
• E) 27.

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Definitions:

Variable Cost

Refers to expenses that change in proportion to the production output or activity level of a company.

Fixed Cost

This is a cost that does not change with an increase or decrease in the amount of goods or services produced or sold.

Diminishing Returns

An economic principle stating that adding an additional factor of production results in smaller increases in output after a certain point.

Marginal Output

The additional quantity of output that is produced by using one more unit of a given input.