Microeconomics: Principles, Applications, and Tools (8th Edition)

Published by Prentice Hall
ISBN 10: 0-13294-886-9
ISBN 13: 978-0-13294-886-9

Chapter 7 - Consumer Choice: Utility Theory and Insights from Neuroscience - Exercises - 7.2 The Law of Demand and the Individual Demand Curve - Page 177: 2.1

Answer

downward 6 less

Work Step by Step

The graph shifts down because the utils per dollar is lower when the price is increased. $36\frac{utils}{movie}\div\frac{\$6}{movie}=6\frac{utils}{\$}$ Since the marginal utility was previously balanced at 12, the marginal utility of movies is now less than that of books.
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