% listed on the left Question Selected Match Utility M. A subjective measure of the level of satisfaction one derives from consuming a good or service. Marginal Utility (MU) A - Change in Total UtilTy and can be positive, zero, or negative Change in Quantity The Law of Diminishing Marginal Utility C. The total utility gained from consuming a good or service starts to decline (diminish) immediately after the 1 5t unit. A budget constraint K All the possible combinations of goods and services that Ms. Addis' family can buy with her after tax annual income of $64,000. Equimarginal principle F.- MU, _ MUz _ MUs P2 P3 .. where P = Price MUI MUz L P2 A consumer who spends all his income on these two goods can increase utility by buying more of good 2 and less of good 1. The budget constraint line shifts to the left. N. An increase in the price of one or both goods while income is constant. Backward-bending segment of the labor supply E. An increase in the wage rate decreases hours of work curve Making choices for both the present and the 1. Intertemporal budget constraint future (across time) A customer chose to have a scoop of Ice cream G. An example of diminishing marginal utility instead of a 3" cup of French fries