The below table shows the average utility (in utils) obtained from the consumption of goods A and B.Table 7.3

-It is often observed that, over the same period of time and for the same good, marginal utility declines rapidly for some consumers and very little for others. This observation illustrates:
A)that economic theory is of little value in explaining consumer behavior.
B)that consumers are not identical.
C)tastes and preferences should not be included in any discussion of consumer choice.
D)tastes and preferences among consumers are quite similar.
E)that if consumers weren't identical, economic theory would not be able to provide insight into consumer behavior.

Question

The below table shows the average utility (in utils) obtained from the consumption of goods A and B.Table 7.3
 
-It is often observed that, over the same period of time and for the same good, marginal utility declines rapidly for some consumers and very little for others. This observation illustrates:
A)that economic theory is of little value in explaining consumer behavior. 
B)that consumers are not identical. 
C)tastes and preferences should not be included in any discussion of consumer choice. 
D)tastes and preferences among consumers are quite similar. 
E)that if consumers weren't identical, economic theory would not be able to provide insight into consumer behavior.

Quizplus · Accepted Answer

The fact that marginal utility declines at different rates for different consumers suggests that consumers are not identical. This highlights the importance of recognizing individual differences in tastes, preferences, and behavior, and underscores the need for a more nuanced approach to analyzing consumer choice than simplistic, one-size-fits-all models. While economic theory is still valuable in explaining consumer behavior, it needs to be applied in a way that acknowledges and accounts for individual variation.

The Below Table Shows the Average Utility (In Utils) Obtained