1st

As in the Indicator, you value water very much when you have none and you get a first few gallons. You value it less after getting 20 gallons. Less than that after getting 200 gallons. And so on. You made an agreement with Al's Rye Barn to buy 10 gallons of rye whiskey per month, every month, for the next 6 years. Obviously, you love rye whiskey. However, it has a marginal value to you. After 100 gallons, you begin to value each gallon less. In fact, you value gallon 101 exactly 6% less than 100, 102 6% less than 101 and so on for each additional gallon. If the value of a gallon of your favorite rye whiskey is $50 per gallon for gallon 1 then how much should you pay in present worth for the 6 contract with Al's Rye Barn if your MARR is 10% per month? Whether its boots, water, gummy bears, kisses, cartoons, jeans, etc., etc., there is no absolute price or absolute level of utility, thus absolute utility does not matter what matters is The marginal utility The quantity The quality The opportunity cost