Author Question: Sam spends all of his income on textbooks and hot dogs. The price of a textbook is 40 and the price ... (Read 65 times)

mia · **on:** Jun 29, 2018

Sam spends all of his income on textbooks and hot dogs. The price of a textbook is 40 and the price of a hot dog is 0.50.

If Sam is maximizing his utility and the marginal utility he derives from the last textbook he purchases is 400, then the marginal utility he derives from his last hot dog purchased must be A) 400.
B) 10.
C) 5.
D) 20.

Question 2

The above figure shows the marginal social benefit and marginal social cost curves of doughnuts in the nation of Kaffenia. What is the marginal social cost to the economy of Kaffenia of producing the 300th dozen doughnuts each day?

A) 10.00 per dozen
B) 8.00 per dozen
C) 6.00 per dozen
D) 4.00 per dozen