If Consumption of an Extra Unit of a Product Delivers

question 46

Multiple Choice

If consumption of an extra unit of a product delivers a positive marginal utility,then consumption of that additional unit would mean

• A)that total utility would be decreasing.
• B)that the consumer would no longer receive any satisfaction from any consumption of this good.
• C)that total utility would be increasing.
• D)that total utility would not change.
• E)that total utility is also zero.

---

Definitions:

Payback Period

The length of time it takes for an investment to generate an amount of cash flow equal to the initial amount invested.

NPV

Net Present Value, a financial metric used to evaluate the profitability of an investment or project, calculated by discounting the expected future cash flows to present day values and subtracting the initial investment cost.

Discounted Payback Period

The time required to recoup the cost of an investment while accounting for the time value of money, typically used in capital budgeting to assess profitability.

After-Tax Cash Inflows

The net cash that a business generates after accounting for all taxes.