Question

Sam operates an ice cream truck. He wants to take a month long trip to Ireland to visit his relatives, which would require that he not sell ice cream from his truck during that month. Using the concept of marginal benefit of ice cream to Sam’s customers, explain whether Sam should take his trip in the summer or the winter.

Answer 1

Usually, ice creams have high demand during summer and this is due to the fact that the weather is hot and the consumers prefer to have it to tackle the temperature and in this regard it can be said that the customers have high marginal benefit in consuming one additional unit of ice cream during summer and not during winter. That is the reason the sales are high during summer and therefore it would be better if Sam takes a trip during winter as the demand for ice creams are lo.