Scenario 5.1 The Demand for Noodles Is Given by the Following Equation

Multiple Choice

Scenario 5.1
The demand for noodles is given by the following equation: Q = 20 - 4P + 0.2I - 2P_x. Assume that P = $8, I = 200, and P_x = $10.
-Suppose you go out with your friend for coffee and donuts at the local donut store. The first donut you eat tastes incredibly good. The second one also tastes pretty good. The third donut seems just okay. With the fourth donut you are turning somewhat green. The fifth donut makes you sick. Your friend, an economist, describes your experience as the principle of:

A) utility maximization.
B) irrationality in consumer behavior.
C) instant gratification.
D) differing tastes and preferences.
E) diminishing marginal utility.