The Maximum Price a Consumer Is Willing to Pay for an Extra

question 242

Multiple Choice

The maximum price a consumer is willing to pay for an extra unit of a good or service when total utility is maximized is known as

• A) demand.
• B) marginal benefit.
• C) quantity demanded.
• D) total utility.
• E) marginal utility.

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Definitions:

Trade Barriers

Restrictions set by a government to control international trade, often to protect domestic industries.

Purchasing Power Parity

An economic theory that compares different countries' currencies through a "basket of goods" approach to assess the relative value of the currencies.

Corn Price

The market value at which corn, a major agricultural commodity, is traded.

Inflation Rate

The percentage rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is falling.