Taylor's Marginal Utility from Watching Movies and from Eating Out

question 98

Multiple Choice

Taylor's marginal utility from watching movies and from eating out (in utils) is shown below. Taylor spends exactly $100 every month on these two forms of entertainment, and the price of each movie is $10 and the price of each dinner is $20. $$\begin{array} { | c | c | c | c | } \hline \begin{array} { c } \text { Movies } \\\text { Per Month }\end{array} & \begin{array} { c } \text { Marginal Utility } \\\text { Per Movie }\end{array} & \begin{array} { c } \text { Dinners Out } \\\text { Per Month }\end{array} & \begin{array} { c } \text { Marginal Utility } \\\text { Per Dinner }\end{array} \\\hline 1 & 60 & 1 & 150 \\\hline 2 & 50 & 2 & 140 \\\hline 3 & 20 & 3 & 120 \\\hline 4 & 5 & 4 & 100 \\\hline\end{array}$$ Taylor's optimal combination of movies and eating out is:

• A)3 movies and 3 dinners.
• B)4 movies and 3 dinners.
• C)3 movies and 4 dinners.
• D)2 movies and 4 dinners.

Grasp the fundamentals and applications of cost-volume-profit (CVP) analysis.

Identify and explain the concepts of fixed, variable, and mixed costs in relation to production levels.

Understand the methods and importance of cost behavior analysis for managerial decision-making.

Comprehend the relevant range concept and its significance in cost accounting.

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Definitions:

Newspaper

A publication, generally made of paper and ink, that is distributed on a regular or daily basis and contains news, articles, advertisements, and other information of public interest.

Marginal Utility

The supplementary contentment or value a shopper obtains by buying an extra unit of a certain item or service.

Total Utility

The overall satisfaction or value a consumer receives from consuming a given quantity of goods or services.

Negative Marginal Utility

The decrease in satisfaction or usefulness obtained from consuming one more unit of a product, leading to decreased overall utility.