Marginalism Is

question 201

Multiple Choice

Marginalism is

• A) the best alternative that we forgo when making a decision.
• B) the study of how societies choose to use scarce resources.
• C) a market situation in which profit opportunities are eliminated almost instantaneously.
• D) the process of analyzing the additional costs or benefits arising from a decision.

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Definitions:

Marginal Utility

The extra pleasure or advantage a customer gains by consuming an additional unit of a product or service.

Loss of Value

The decrease in worth of an asset or investment over time, often due to market fluctuations or the asset's deterioration.

Total Utility

The overall satisfaction or happiness a consumer derives from consuming a certain quantity of a good or service.

Marginal Utility

is the added satisfaction or benefit a consumer gets from consuming one additional unit of a good or service.