Jason can maximize his satisfaction by allocating time among market work, nonmarket work, and leisure so that the final marginal utilities per hour spent in each activity are identical.

Question

Quizplus · Accepted Answer

This is a basic principle in microeconomics known as the principle of equal marginal utility, which states that utility can be maximized by allocating resources such that the marginal utilities per unit of resource spent in each activity are equal. In the context of time allocation, this means that Jason can maximize his satisfaction by allocating time among market work, nonmarket work, and leisure in a way that the additional satisfaction (marginal utility) he receives from each additional hour spent in each activity is the same.

Jason Can Maximize His Satisfaction by Allocating Time Among Market