Based upon the following table, what is the marginal utility of the 3rd unit consumed?

Unit # Marginal Utility Total Utility

1 st 75 utils 75 utils

2 nd 55 " 130 " 

3 rd ? " 170 "

A) 20 utils B) 30 utils C) 40 utils D) 50 utils

 23). Consumer utility maximization can be written as shown below which means the marginal utils per $ are equal for products A and B.

MU of product A = MU of product B

Price of APrice of B

A) true B) false

24). If the MUa/Pa < MUb/Pb > MUc/Pc a consumer should do which of the following to increase utility? 

A) buy more of product a and less of product b 

B) buy more of product c and less of product b 

C) buy more of product b and less of products a and/or c 

D) none of the above 

25). Answer the question below on consumer utility maximization using the following marginal utility table for products X and Y. Assume that the prices of X and Y are $4 and $2 respectively and that the consumer's income is $18

MARGINAL UTILITY TABLE

Units Marginal Units Marginal

of X utility, X of Y utility, Y

120116

216214

312312

48410

5658

6466

Refer to the above marginal utility table. What quantities of X and Y should be purchased to maximize utility? (remember to maximize utility, a consumer should buy the product with the highest MU/$1.00 and continue to do so until all income has been expended). 

A) 2 of X and 1 of Y 

B) 4 of X and 5 of Y 

C) 2 of X and 5 of Y 

D) 2 of X and 6 of Y 

Answer rating: 100% (QA)

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