At Frankie's Buy-the-Slice Pizza,Bill eats three slices of pizza and then realizes that he enjoyed the second slice more than the third.Even though the price per slice is just $1,the utility-maximizing decision is to quit eating now since Bill has reached diminishing marginal utility.

Question

Quizplus · Accepted Answer

Diminishing marginal utility means each additional slice provides less satisfaction, but it doesn't necessarily mean Bill should stop eating. He should stop when the marginal utility of the next slice is less than the price.

At Frankie's Buy-The-Slice Pizza,Bill Eats Three Slices of Pizza and Then