Figure 27-3 The Following Figure Shows a Utility Function for Dexter

question 150

Multiple Choice

Figure 27-3
The following figure shows a utility function for Dexter.
-Refer to Figure 27-3. From the appearance of the graph, we know that

• A)Dexter's level of satisfaction increases by more when his wealth increases from $1,001 to $1,002 than it does when his wealth increases from $1,000 to $1,001.
• B)Dexter's level of satisfaction increases by less when his wealth increases from $1,001 to $1,002 than it does when his wealth increases from $1,000 to $1,001.
• C)Dexter's level of satisfaction increases by the same amount when his wealth increases from $1,001 to $1,002 as it does when his wealth increases from $1,000 to $1,001.
• D)the change in Dexter's level of satisfaction is constant as wealth increases.

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Definitions:

Hank's Honkytonk

A fictional or specific bar or entertainment venue, often associated with country music and dancing.

Unprofitability

The condition of a business or an investment generating more expenses than revenue, resulting in a financial loss.

Nickel-and-dimed

A phrase describing a situation where small amounts of money are frequently charged, leading to a substantial total expense over time.

Entrance Fees

Charges that must be paid as a condition of gaining entry to a service, facility, event, or market.