Table 8.1 -Refer to Table 8.1.Suppose Mr.B Withdrew $50,000 from His Account

question 111

Multiple Choice

Table 8.1
-Refer to Table 8.1.Suppose Mr.B withdrew $50,000 from his account that earned 10% to invest into this business.He quit his full-time job that paid $40,000 to manage this business.If Mr.B is excited about his $45,000 profit,an economist would

• A) celebrate with him.
• B) mention the $90,000 he has given up.
• C) tell him his economic profit is indeed positive but not as big as $45,000.
• D) tell him he made zero economic profit.

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Definitions:

Total Utility

The aggregate level of satisfaction or fulfillment that a consumer receives through the consumption of goods or services.

Total Utility

This is the aggregate level of satisfaction or value that consumers derive from consuming a given amount of goods or services.

Marginal Utility

The additional satisfaction or utility received by consuming one more unit of a good or service.

Marginal Utility

The additional satisfaction or benefit (utility) that a consumer derives from purchasing one more unit of a good or service.