Consumer Spending Trends

Click on "Demo." Scroll down the page to learn how real time market (consumer spending) profile information can be generated.

• Explain why many businesses are willing to pay for services that track consumer spending trends.
• Why do most direct marketing campaigns (e.g. sending marketing letters or rebate offers) identify their target markets by utilising postal zip codes?

Utility - All You Can Eat Buffets

Examine the menu at the Uncle Wok Chinese Restaurant.
a. Use the theory discussed in your text to explain how an all you can eat buffet can be profitable for a restaurant.
b. Would a typical individual consume more or less food under this arrangement than if he or she had to pay for each individual item of food?
c. At what point do individuals stop eating?

Marginal Utility - Online Service Cost

Compare the standard plan and the limited usage plans offered by America Online.
a. Assuming that an individual uses more than five hours of connection time each month, under which of these plans would the marginal utility of the last minute spent online be higher? Why?
b. Would the marginal utility of the last hour spent online be equal to zero for either of these plans? Explain your answer.