Cory gets 18, 23, and 25 units worth of total utility from consuming 10, 11, and 12 raw oysters, respectively, and the price per oyster is 25 cents. Thus, one can infer that Cory:
A)is not maximizing his utility.
B)is experiencing diminishing marginal utility.
C)should not consume any more oysters.
D)has consumed too many oysters.

Question

Quizplus · Accepted Answer

The marginal utility of consuming an additional oyster gets smaller as more oysters are consumed. The marginal utility is 5 for the 11th oyster (total utility goes from 18 to 23)and 2 for the 12th oyster (total utility goes from 23 to 25), which is consistent with the law of diminishing marginal utility.

Cory Gets 18, 23, and 25 Units Worth of Total