If Paul decides to buy a $60 ticket to a Cirque du Soleil show rather than a $45 ticket for a Blue Man Group performance, we can conclude that
A)the marginal utility per dollar spent on Cirque du Soleil is lower than the marginal utility per dollar spent on Blue Man Group.
B)Paul's demand for a ticket to see Cirque du Soleil is more elastic than his demand for a ticket to see Blue Man Group.
C)Paul is not making a rational choice.
D)the marginal utility per dollar spent on Cirque du Soleil is higher than the marginal utility per dollar spent on Blue Man Group.

Question

Quizplus · Accepted Answer

If Paul is willing to spend $60 on a Cirque du Soleil ticket instead of spending $45 on a Blue Man Group ticket, it suggests that Paul derives more utility or satisfaction from attending the Cirque du Soleil show. Therefore, the marginal utility per dollar spent on the Cirque du Soleil ticket is higher than the marginal utility per dollar spent on the Blue Man Group ticket. Option D is, therefore, the correct answer.

If Paul Decides to Buy a $60 Ticket to a Cirque