Suppose the price of mobile apps increases. As a result, Khalil decreases the number of mobile apps he purchases. This will lead to
A) an increase in total utility for each mobile app purchased.
B) no change in total utility for each mobile app purchased.
C) higher marginal utility from the last mobile app purchased.
D) lower marginal utility.

Question

Quizplus · Accepted Answer

When the price of mobile apps increases and Khalil decreases his purchases, the marginal utility of the last app he buys increases because he is now more selective, choosing only those apps that provide the most satisfaction per dollar spent.

Suppose the Price of Mobile Apps Increases