Bob's Marginal Utility for consuming beer and pizza with $8.00 in income

-In the above table, Bob experiences diminishing marginal utility after consuming how many beers?
A) 1
B) 2
C) 3
D) 4

Question

Bob's Marginal Utility for consuming beer and pizza with $8.00 in income
 
-In the above table, Bob experiences diminishing marginal utility after consuming how many beers?
A) 1 
B) 2 
C) 3 
D) 4

Quizplus · Accepted Answer

Bob experiences diminishing marginal utility after consuming 2 beers. At this point, his marginal utility decreases from 16 to 12. Therefore, the best choice(s) for Bob would be to consume 2 beers and 1 pizza or 1 beer and 2 pizzas, depending on his individual preferences. Consuming more beers beyond the second will result in lower overall satisfaction.

Bob's Marginal Utility for Consuming Beer and Pizza with $8