If Terry gets maximum utility from owning 10 pairs of shoes,then Terry's total utility from owning 7 pairs of shoes is ______ Terry's total utility from owning 8 pairs.
A)greater than
B)equal to
C)less than
D)less than or equal to

Question

Quizplus · Accepted Answer

According to the law of diminishing marginal utility, as we consume more and more of a good, the additional satisfaction we gain from consuming an additional unit of that good decreases. Therefore, Terry's total utility from owning 7 pairs of shoes is less than Terry's total utility from owning 8 pairs. Since Terry's maximum utility is achieved at owning 10 pairs of shoes, any quantity of shoes less than 10 will have less utility than owning 10 pairs. Therefore, the answer is C, less than.

If Terry Gets Maximum Utility from Owning 10 Pairs of Shoes,then