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    Does my utility increase if I pay less?

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    You attend an auction and in your mind agree to pay $100 for an item, but you are able to purchase at $50.

    1. Discuss the comparison of the utility of the $100 versus the utility of the good and how a voluntary exchange results in a win/win situation to both parties.

    2. Has the utility of the item increased because of the lower price and why?

    3. As a result of the lower price, has your total utility increased and why?

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    https://brainmass.com/economics/utility/does-my-utility-increase-if-i-pay-less-455858

    Solution Preview

    1. Discuss the comparison of the utility of the $100 versus the utility of the good and how a voluntary exchange results in a win/win situation to both parties.

    I am willing to give up $100 to obtain the item, so the item's utility ...

    Solution Summary

    This solution explains whether the utility I derive from an item increases if I buy it cheaply, and whether my total utility increases as a result.

    $2.19