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A
True
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Answer
Marginal analysis helps consumers make decisions about how much of a good to buy by comparing the additional benefits and costs. A consumer should keep increasing their consumption of a good until the extra benefit they get from consuming one more unit is greater than the extra cost they have to pay for it. However, it is also important to consider overall satisfaction, or utility, because just focusing on marginal benefits and costs might lead to choices that don’t maximize happiness. For example, if you enjoy ice cream, you might keep buying it as long as each scoop gives you more joy than its price. But if you eat too much, it could make you feel sick, which shows that balancing enjoyment and health is key for overall satisfaction.
Detailed Explanation
It's important to consider overall satisfaction. Other options are incorrect because This answer suggests you can ignore overall happiness.
Key Concepts
Marginal analysis
Utility maximization
Consumer surplus
Topic
Marginal Analysis
Difficulty
hard level question
Cognitive Level
understand
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