The Concept of Marginal Utility

question 4

Multiple Choice

The concept of marginal utility:

• A) explains why individuals find it difficult to maximize their total utility.
• B) is the change in total utility that comes from consuming one additional unit of a good or service.
• C) can only be applied to situations in which individuals can choose among several goods or services.
• D) is the loss in utility from making a bad decision.

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Definitions:

Difference Threshold

The smallest detectable difference between two stimuli or the minimum change in a stimulus that can be correctly perceived as differing from a reference stimulus.

Just Noticeable Difference

The minimum difference in stimulus intensity that a specific sense (like sight, hearing, taste, touch, or smell) can detect.

Optic Nerve

The nerve that transmits sensory information from the eye to the brain.

Occipital Lobe

is the region of the brain located at the back of the head, responsible for processing visual information.