John Has Just Eaten Another Potato Chip and His Total

question 304

Multiple Choice

John has just eaten another potato chip and his total utility decreased. This means that John's marginal utility for this additional potato chip is

• A) positive.
• B) negative.
• C) zero.
• D) not determinable without more information.

---

Definitions:

Depreciation Expense

Distributing the expense of a physical asset across its lifespan.

Fixed Costs

Costs that do not vary with the level of production or sales, including expenses like rent, salaries, and insurance.

Variable Costs

Expenses that change in proportion to the activity of a business, such as utility bills that increase with production volume.

Cash Break-Even

The sales level where operating cash flow is equal to zero.