A consumer obtains a total utility (TU) of 18 utils, 32 utils, 42 utils, 48 utils, and 50 … — JAMB UTME

A consumer obtains a total utility ( $TU$ ) of $18$ utils, $32$ utils, $42$ utils, $48$ utils, and $50$ utils from consuming $1$ , $2$ , $3$ , $4$ , and $5$ cups of coffee, respectively. What is the marginal utility ( $MU$ ) derived from consuming the $4^{\text{th}}$ cup of coffee?

Answer: 6 utils

Answer

The marginal utility derived from consuming the 4th cup of coffee is 6 utils.

Marginal Utility (

MU

) represents the extra utility gained from consuming an additional unit of a commodity. It is computed as

MU = TU_n - TU_{n-1}

. For the 4th cup of coffee,

MU_4 = TU_4 - TU_3 = 48 - 42 = 6

utils.

Step-by-Step Solution

Identify the Total Utility for the target unit and the preceding unit

TU_4 = 48

utils and

TU_3 = 42

utils

Marginal Utility measures the addition to total utility from consuming one more unit.

Apply the Marginal Utility formula

MU = \frac{\Delta TU}{\Delta Q}

MU_4 = \frac{48 - 42}{4 - 3} = \frac{6}{1} = 6

utils

The change in quantity is 1 unit, so

MU

is simply the difference between

TU_4

and

TU_3

Key Concept

Calculation of Marginal Utility from Total Utility schedule

Estimated Time:1m 0s

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