Explore BrainMass
Share

Consumer Choice Theory: Marginal Utility of Chicken Pieces

This content was STOLEN from BrainMass.com - View the original, and get the already-completed solution here!

The table below shows the maximum amount of money you would be willing to pay for increasing numbers of chicken pieces at Fastfood:

Chicken Pieces Maximum Payment

1 $2.00
2 3.80
3 5.40
4 6.80
5 8.00
6 9.00
7 9.80
8 10.40
9 10.80
10 11.00
11 11.00

a) Find the marginal utility for each chicken piece. What is the meaning of the marginal utility of the 11th piece?
b) If the price of chicken pieces is $1.25 each, how many will you buy?
c) If the price falls to $.50, how many will you buy? Explain carefully why you will not buy one more.
d) What is the consumer surplus, or net benefit, that you get from purchasing chicken pieces at $.50?

© BrainMass Inc. brainmass.com October 25, 2018, 7:28 am ad1c9bdddf
https://brainmass.com/economics/utility/consumer-choice-theory-marginal-utility-of-chicken-pieces-504287

Attachments

Solution Preview

a) See the attached file. My marginal utility (MU) for each piece can be measured by the amount of money that I would be willing to pay to get it. The MU of the 11th piece is zero, which means that I would eat ...

Solution Summary

This solution uses marginal analysis to predict how many pieces of chicken I will consumer at a given price.

$2.19
See Also This Related BrainMass Solution

Business ethics and social responsibility, global business, strategies, trade, WTO

Discuss the basic forms of conducting international business (export/import, licensing/franchising, contract manufacturing/outsourcing, joint ventures/alliances, and direct investment), and basic international business strategies (multinternational vs global)

Discuss the trade (economic reason why trade occurs,) the role of the World Trade Organization, regional trade agreements, and the barriers to international trade

Discuss the business ethics (concept, common issues, ethical decision factors), actions to promote ethical behavior, social responsibility (concept/dimensions, consumerism), and the business legal environment (source of law, resolution of disputes)

Plus references.

View Full Posting Details