This topic contains a solution. Click here to go to the answer

Author Question: As a consumer allocates income between good A and good B, total utility is maximized when a. the ... (Read 106 times)

809779

  • Hero Member
  • *****
  • Posts: 579
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
Answer to Question 1

E

Answer to Question 2

C




809779

  • Member
  • Posts: 579
Reply 2 on: Jul 1, 2018
Thanks for the timely response, appreciate it


matt95

  • Member
  • Posts: 317
Reply 3 on: Yesterday
Great answer, keep it coming :)

 

Did you know?

Less than one of every three adults with high LDL cholesterol has the condition under control. Only 48.1% with the condition are being treated for it.

Did you know?

Vampire bats have a natural anticoagulant in their saliva that permits continuous bleeding after they painlessly open a wound with their incisors. This capillary blood does not cause any significant blood loss to their victims.

Did you know?

Ether was used widely for surgeries but became less popular because of its flammability and its tendency to cause vomiting. In England, it was quickly replaced by chloroform, but this agent caused many deaths and lost popularity.

Did you know?

Adults are resistant to the bacterium that causes Botulism. These bacteria thrive in honey – therefore, honey should never be given to infants since their immune systems are not yet resistant.

Did you know?

Approximately 500,000 babies are born each year in the United States to teenage mothers.

For a complete list of videos, visit our video library