ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Why is it that this was wrong? Marginal utility question

**Question 29**

We can explain the paradox of value as follows: The consumer surplus from water, which is cheap, is _______ than the consumer surplus from gold, which is expensive; the total utility from gold is _______ than the total utility from water; and the marginal utility per dollar spent on water _______ the marginal utility per dollar spent on gold.

- ○ greater; less; equals
- ○ smaller; less; equals
- ○ greater; greater; greater than
- ● less; greater; greater than

**Answer Explanation:**
The correct choice is "less; greater; greater than." This indicates that the consumer surplus from water is less than that from gold, while the total utility from gold is greater than from water, and the marginal utility per dollar spent on water is greater than that on gold.
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Transcribed Image Text:**Question 29** We can explain the paradox of value as follows: The consumer surplus from water, which is cheap, is _______ than the consumer surplus from gold, which is expensive; the total utility from gold is _______ than the total utility from water; and the marginal utility per dollar spent on water _______ the marginal utility per dollar spent on gold. - ○ greater; less; equals - ○ smaller; less; equals - ○ greater; greater; greater than - ● less; greater; greater than **Answer Explanation:** The correct choice is "less; greater; greater than." This indicates that the consumer surplus from water is less than that from gold, while the total utility from gold is greater than from water, and the marginal utility per dollar spent on water is greater than that on gold.
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