Author Question: Monica consumes only goods A and B. Suppose that her marginal utility from consuming good A is ... (Read 114 times)

abarnes · **on:** Jul 1, 2018

Monica consumes only goods A and B.

Suppose that her marginal utility from consuming good A is equal to 1/Qa, and her marginal utility from consuming good B is 1/Qb. If the price of A is 0.50, the price of B is 4.00, and the Monica's income is 120.00, how much of good A will she purchase?
A) 0
B) 12
C) 24
D) 48
E) 120

Question 2

The battery packs used in electric and hybrid automobiles are one of the largest cost components for manufacturing these cars. As the price of these batteries decline, we expect that the:

A) supply curve for electric and hybrid autos will shift rightward.
B) supply curve for electric and hybrid autos will shift leftward.
C) demand curve for electric and hybrid autos will shift rightward.
D) demand curve for electric and hybrid autos will shift leftward.