Complete the following table and answer the questions below: Units Consumed Total Utility Marginal Utility 0 0 — 1 10 10 2   8 3 25   4 30   5   3 6 34   a. At which rate is total utility increasing: a constant rate, a decreasing rate, or an increasing rate? How do you know? b. True or False. “A rational consumer will purchase only 1 unit of the product represented by these data, because that amount maximizes marginal utility.” c. True or False. “It is possible that a rational consumer will not purchase any units of the product represented by these data.”

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Complete the following table and answer the questions below:

Units Consumed Total Utility Marginal Utility
0 0
1 10 10
2   8
3 25  
4 30  
5   3
6 34  

a. At which rate is total utility increasing: a constant rate, a decreasing rate, or an increasing rate? How do you know?

b. True or False. “A rational consumer will purchase only 1 unit of the product represented by these data, because that amount maximizes marginal utility.”

c. True or False. “It is possible that a rational consumer will not purchase any units of the product represented by these data.”

Expert Solution
Step 1

Total utility  is the total amount of happiness a consumer derives from a good at any particular level of consumption.

marginal utility  is the change in total utility that a consumer experiences when one or more unit of a good is consumed.

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