Jill likes lobsters but she does NOT eat lobsters in every meal. How can utility theory explain this?
What will be an ideal response?
Even though Jill likes lobsters, she is probably facing diminishing marginal utility from lobster consumption over a given period of time. Her marginal utility from eating more lobsters within a week after a meal of lobsters might be zero. Thus, she does not want to eat any more lobsters in that week.
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