This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: As a consumer allocates income between good A and good B, total utility is maximized when a. the ... (Read 83 times)

809779

  • Hero Member
  • *****
  • Posts: 579
on: Jul 1, 2018
As a consumer allocates income between good A and good B, total utility is maximized when
 a. the marginal utility of A = the marginal utility of B
  b. the marginal utility of A = the marginal utility of B = 0
  c. the price of A = price of B
  d. marginal utility of A/price of A = marginal utility of B/price of B = 0
  e. marginal utility of A/price of A = marginal utility of B/price of B

Question 2

When a consumer spends income so that the ratio of marginal utilities (MUs) of all goods purchased equals the ratio of their prices, the consumer is
 a. maximizing marginal utility
  b. spending too much on all goods
  c. maximizing total utility
  d. beyond the point of diminishing marginal utility
  e. behaving in opposition to the principal of rational behavior


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Christopher

  • Sr. Member
  • ****
  • Posts: 316
Reply #1 on: Jul 1, 2018
Answer to Question 1

E

Answer to Question 2

C


809779

  • Member
  • Posts: 579
Reply 2 on: Jul 1, 2018
Great answer, keep it coming :)

covalentbond

  • Member
  • Posts: 336
Reply 3 on: Yesterday
Gracias!

« previous next »
 

Did you know?

If you could remove all of your skin, it would weigh up to 5 pounds.

Did you know?

In 1835 it was discovered that a disease of silkworms known as muscardine could be transferred from one silkworm to another, and was caused by a fungus.

Did you know?

Acute bronchitis is an inflammation of the breathing tubes (bronchi), which causes increased mucus production and other changes. It is usually caused by bacteria or viruses, can be serious in people who have pulmonary or cardiac diseases, and can lead to pneumonia.

Did you know?

When blood is exposed to air, it clots. Heparin allows the blood to come in direct contact with air without clotting.

Did you know?

To prove that stomach ulcers were caused by bacteria and not by stress, a researcher consumed an entire laboratory beaker full of bacterial culture. After this, he did indeed develop stomach ulcers, and won the Nobel Prize for his discovery.

The risk of dying before the age of 65 gets lower as family income gets higher. The risk of dying before the age of 65 gets lower as family income gets higher.
The Inverted Income Pyramid: The Proportion of Income Received by Each Fifth of the U.S. Population The Inverted Income Pyramid: The Proportion of Income Received by Each Fifth of the U.S. Population
Total radiative forcing ~1.63 Wm-2 Total radiative forcing ~1.63 Wm-2
How an Increase in Income Inequality Affects the Desired Tax Rate How an Increase in Income Inequality Affects the Desired Tax Rate
Total Fertility Rate in Japan: Actual versus Forecast Total Fertility Rate in Japan: Actual versus Forecast
What is the total resistance of the circuit in Figure 1? 150 What is the total resistance of the circuit in Figure 1? 150
Video: Monohybrid crosses

For a complete list of videos, visit our video library