Olivia decides to forgo a third slice of pizza and eats an ice cream cone instead. This behavior exemplifies the economic concept of:
A)diminishing marginal utility.
B)altruism.
C)reciprocity.
D)selfishness.

Question

Quizplus · Accepted Answer

Olivia's decision to choose an ice cream cone over a third slice of pizza illustrates diminishing marginal utility, a concept where the satisfaction (utility) gained from consuming additional units of a good decreases as one consumes more of that good. In this case, the utility Olivia expects from a third slice of pizza is less than the utility from the first ice cream cone, leading her to choose the latter.

Olivia Decides to Forgo a Third Slice of Pizza and Eats