Suppose Carrie's Utility Function for Clams Is as Follows: If

question 116

Multiple Choice

Suppose Carrie's utility function for clams is as follows: If she consumes 1 clam,she gets 10 units of total utility; for 2 clams,she gets 18 units of total utility; for 3 clams,she gets 24 units of total utility; for 4 clams,she gets 28 units of total utility; for 5 clams,she gets 30 units of total utility; and for 6 clams,she gets 26 units of total utility.

• A) Carrie gets 9 units of marginal utility for the 2nd clam.
• B) Carrie gets 8 units of marginal utility for the 3rd clam.
• C) Carrie gets 7 units of marginal utility for the 4th clam.
• D) None of the above are true.

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Definitions:

Boot

Additional cash or property included in a transaction to even out a trade or exchange of dissimilar assets.

Depreciated

Refers to the reduction in the value of an asset over time due to wear and tear or obsolescence.

Nonmonetary Asset

Assets that cannot be easily converted into cash and hold value in forms other than currency, such as property, equipment, and patents.

Boot

In finance and real estate, boot refers to cash or other property added to an exchange or transaction to make it equitable.