Asked by Chris Davis on May 01, 2024
Verified
If you purchase a gift worth $25 for your sister, but your sister would be willing to pay only $10 if she bought the item for herself, then the
A) total utility of the gift is $35.
B) total utility of the gift is $15.
C) marginal utility of the gift is $15.
D) loss of value in the gift is $15.
Marginal Utility
The additional satisfaction or benefit one receives from consuming one more unit of a good or service.
Value Loss
The decline in the worth or market value of an asset, often due to changes in market demand or damage.
Total Utility
The overall satisfaction or benefit a consumer receives from consuming a particular quantity of a good or service.
- Understand the economic foundations that rationalize the activities of gift-giving, theft, and marketplace conduct.
Verified Answer
ZK
Zybrea KnightMay 06, 2024
Final Answer :
D
Explanation :
The loss of value in the gift is $15 because you spent $25 on a gift that your sister values at only $10, indicating a discrepancy or loss in value of $15.
Learning Objectives
- Understand the economic foundations that rationalize the activities of gift-giving, theft, and marketplace conduct.
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