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marginal utility

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1. simple dispensing machines offer opportunites for consumers to take numerous copies for the price of 1 copy. why do consumers usually take only one copy?

2. the price of a seasonal pass to six flags great adventure is not much more than a weekly pass. why is this a reasonable pricing policy?

3. Tim eats only burgers and tacos. in equilibrium, his marginal utility of burgers is 20 and his marginal utility of tacos is 10. The price of burgers is $4. what is the price of a taco?

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Solution Preview

1: marginal utility is decreasing. In this case from the second copy marginal utility is negative, so that taking only one copy maximize ...

Solution Summary

A marginal utility case is demonstrated. A reasonable pricing policy is examined for the seasonal pas to six flags is examined.