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Utility Maximization

AP.MICRO: CBA‑2 (EU), CBA‑2.A (LO), CBA‑2.A.1 (EK), CBA‑2.A.2 (EK), CBA‑2.A.3 (EK), CBA‑2.A.4 (EK), CBA‑2.B (LO), CBA‑2.B.1 (EK), CBA‑2.B.2 (EK), CBA‑2.B.3 (EK)

Problem

Nate is currently spending his entire budget on two goods: food and entertainment. He was willing to pay dollar sign, 2 for the last unit of food he purchased and dollar sign, 2, comma, 000 for the last unit of entertainment he purchased.
Which of the following is the best explanation of why he is willing to pay so much more for entertainment?
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Choose 1 answer:
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