Two economists are attending a conference in an unfamiliar city. At the end of the day, Economist A states she is "in the mood for a high-quality dinner" and wanders through the center of the city looking for a restaurant. After narrowing her search to two fine-dining establishments located on the same block, she ultimately selects the restaurant with the higher prices (assuming cost is not an issue for either economist). Economist B chooses to go to a one-price all-you-can-eat buffet. Using economic theory how would you explain the difference in way Economist A goes about maximizing her utility compared to Economist B? Next year when they both return to the economics conference in the same city, which of the two restaurants do you think has a higher chance of not being there anymore? (one paragraph)

Instructor's Note: Marginal utility is the key economic concept at work here. You will need to apply it to both economists. Each economist goes about maximizing his/her utility in a different way. In the process of maximizing their total utility, note carefully how each is receiving marginal utility to the point where the total utility is maximized. What is this point in economics? Review the concept of diminishing marginal utility to better answer this question.

Break the question into parts:

1. Assume you are Economist B and choose to go to a one-price all-you-can-eat buffet nearby. Using economic theory, what might account for the difference in behavior between Economist A and you (assuming cost is not an issue)? Explain how each economist applies the utility principle in different ways to obtain maximum utility.
2. How would you go about maximizing your utility compared to Economist A? Be specific in the various ways you get the most satisfaction with the buffet arrangement, especially by explaining how you best utilize marginal utility.
3. Next year when you both return to an economics conference in the same city, which of the two restaurants do you think has a higher chance of not being there anymore? Explain.Look up the economics of buffet restaurants versus specialty restaurants and see which one has better economics on its side.