Assume that the total utilities corresponding to the first five units of a product consumed are 14, 20, 25, 29, and 32, respectively.The marginal utility of the third unit is:
A) 5.
B) 6.
C) 20.
D) 25.

Question

Quizplus · Accepted Answer

Marginal utility is the additional satisfaction or utility that a consumer derives from consuming an additional unit of a good or service. It can be calculated by subtracting the total utility of the previous consumption level from the total utility of the current consumption level. For the third unit, the total utility is 25 and for the second unit, it is 20. Therefore, the marginal utility of the third unit is 25 - 20 = 5.

Assume That the Total Utilities Corresponding to the First Five