The marginal utility from the first burrito Bobby consumes is larger than the marginal utility from the first taco Bobby consumes. As a result
A) tacos are an inferior good for Bobby.
B) Bobby will never consume tacos.
C) Bobby will consume a taco only if the price of a taco is less than the price of a burrito.
D) burritos and tacos are substitute goods for Bobby.

Question

Quizplus · Accepted Answer

Bobby will consume a taco only if the price of a taco is less than the price of a burrito because he derives more utility from the first burrito, so he would need a price incentive to choose a taco over a burrito.

The Marginal Utility from the First Burrito Bobby Consumes Is