Economics 1021A Chapter 8

17 467 600 700 700 1250 price dollars per game

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Unformatted text preview: er movie) A Rise in the Price of Bowling Movies 6 3 0 Lisa’s demand for movies when bowling costs $6 Lisa’s demand for movies when bowling costs $3 5 6 Quantity (movies per month) Predictions of Marginal Utility Theory Two predictions of marginal utility theory: When the price of a good rises, the quantity demanded for that good decreases. If the price of one good rises, the demand for another good that can serve as a substitute increases. EXPLAINE D theory of Chapter 3 Lisa’s Choices with an Income of $42 a Month Movies ($3 per movie) Marginal utility Quantity per dollar spent spent 0 1 16.67 2 12.67 3 11.00 4 9.67 5 8.33 6 7.00 7 6.00 7 6.00 8 5.00 9 4.00 10 3.00 11 2.00 12 1.00 13 0.67 14 0.33 Bowling ($3 per game) Marginal utility Games per dollar 14 13 12 11 10 9 8 7 7 6 5 4 3 2 1 0 3.67 4.00 4.33 4.67 5.00 5.33 5.67 6.00 6.00 6.33 8.33 9.33 12.00 14.00 25.00 Individual Demand and Market Demand Market demand is the relationship between the total quantity demanded of a good an...
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