Dave and Diya play two games of tennis before deciding to stop for lunch. Using the concept of utility to explain their choices, we can conclude that:
A)the marginal utility of the second game must have been zero.
B)the marginal utility they would receive from playing a third game must be negative.
C)the marginal utility they would receive from playing a third game must be less than the marginal utility they would receive from eating lunch.
D)All of these are correct.

Question

Quizplus · Accepted Answer

The concept of utility in economics suggests that individuals make choices to maximize their satisfaction or utility. Dave and Diya's decision to stop playing tennis and have lunch instead indicates that the marginal utility (additional satisfaction) they would gain from playing a third game of tennis is less than the marginal utility they expect to gain from eating lunch. This does not necessarily mean that the marginal utility of the second game was zero (A) or that playing a third game would have negative utility (B), just that lunch offers more utility at that point.

Dave and Diya Play Two Games of Tennis Before Deciding