Question
Last year, Alice's wealth increased by $X and it gave her z units of happiness (or utility). This year Alice's wealth increased again by $X
Last year, Alice's wealth increased by $X and it gave her z units of happiness (or utility). This year Alice's wealth increased again by $X but her utility went up by less than z units. What is this an example of?
Positive marginal utility of wealth
Diminishing marginal utility of wealth
Diminishing marginal return
Conservation of value
Risk aversion
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Public Finance
Authors: Harvey S Rosen
7th Edition
0072876484, 978-0072876482
