The Total Utilities Associated with the First 5 Units of Consumption

question 91

Multiple Choice

The total utilities associated with the first 5 units of consumption of good X are 15, 30, 40, 47, and 50, respectively. What is the marginal utility associated with the third unit?

• A) 15.
• B) 70.
• C) 85.
• D) 10.
• E) 45.

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Definitions:

Government Intervention

Actions taken by a government to influence or regulate various activities within its economy, such as imposing taxes, subsidies, and regulations.

External Costs

Costs incurred by society as a whole due to economic activities but not reflected in the market price or borne by the producer or consumer involved.

Pollution Abatement

Actions or measures taken to reduce, control, or eliminate pollution and its negative impacts on the environment.

Socially Optimal

A condition or output level where the social welfare is maximized, taking into account both the benefits to consumers and the costs to producers.