Finding the optimal combination of two goods Andrew enjoys consuming both cheese and fruit. Each pound...

   

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Finding the optimal combination of two goods Andrew enjoys consuming both cheese and fruit. Each pound of cheese costs Pc = $1, and each pound of fruit costs PF = $2. Suppose that Andrew buys 75 pounds of cheese and 50 pounds of fruit per month. The following graphs show his marginal utility curves for cheese and fruit. At his current consumption level, Andrew's marginal utility from consuming the last pound of cheese he bought is MUC = 12 utils per pound, and his marginal utility from consuming the last pound of fruit he bought is MUF= 12 utils per pound. 24 20 16 16 12 AL 4 100 125 150 12 0 0 25 50 75 CHEESE (Pounds) (?) Is Andrew currently maximizing his utility? 24 20 0 0 25 50 75 100 125 FRUIT (Pounds) O Yes; the marginal utility he receives from his last pound of cheese equals that of his last pound of fruit. O No; he could buy more cheese and less fruit, not spend any more money, and be better off. O No; he likes fruit and cheese more than other goods, so he should buy more of both. O No; he could buy less cheese and more fruit, not spend any more money, and be better off. 150 ? MU OF CHEESE (Utils per pound) 24 20 16 12 0 0 25 50 100 CHEESE (Pounds) Is Andrew currently maximizing his utility? Combination A B с D 75 (Pounds) 100 75 125 25 125 Cheese 150 MU Pe (?) O Yes; the marginal utility he receives from his last pound of cheese equals that of his last pound of fruit. No; he could buy more cheese and less fruit, not spend any more money, and be better off. No; he likes fruit and cheese more than other goods, so he should buy more of both. O No; he could buy less cheese and more fruit, not spend any more money, and be better off. (Pounds) 100 For each of the following combinations of cheese and fruit, calculate the marginal utility per dollar from the last pound of cheese and the last pound of fruit. Then, use the dropdown menus in the last column to indicate which of the combinations satisfy the condition for consumer equilibrium. 50 100 25 20 16 12 L 4 25 50 75 100 FRUIT (Pounds) 24 MU OF FRUIT (Utils per pound) Fruit 0 0 MU Pr 125 Consumer Equilibrium? 150 Suppose Andrew has an "appetizer budget" of $325 per month, which he spends on cheese and fruit. To maximize his utility, Andrew will purchase pounds of cheese and pounds of fruit per month. Finding the optimal combination of two goods Andrew enjoys consuming both cheese and fruit. Each pound of cheese costs Pc = $1, and each pound of fruit costs PF = $2. Suppose that Andrew buys 75 pounds of cheese and 50 pounds of fruit per month. The following graphs show his marginal utility curves for cheese and fruit. At his current consumption level, Andrew's marginal utility from consuming the last pound of cheese he bought is MUC = 12 utils per pound, and his marginal utility from consuming the last pound of fruit he bought is MUF= 12 utils per pound. 24 20 16 16 12 AL 4 100 125 150 12 0 0 25 50 75 CHEESE (Pounds) (?) Is Andrew currently maximizing his utility? 24 20 0 0 25 50 75 100 125 FRUIT (Pounds) O Yes; the marginal utility he receives from his last pound of cheese equals that of his last pound of fruit. O No; he could buy more cheese and less fruit, not spend any more money, and be better off. O No; he likes fruit and cheese more than other goods, so he should buy more of both. O No; he could buy less cheese and more fruit, not spend any more money, and be better off. 150 ? MU OF CHEESE (Utils per pound) 24 20 16 12 0 0 25 50 100 CHEESE (Pounds) Is Andrew currently maximizing his utility? Combination A B с D 75 (Pounds) 100 75 125 25 125 Cheese 150 MU Pe (?) O Yes; the marginal utility he receives from his last pound of cheese equals that of his last pound of fruit. No; he could buy more cheese and less fruit, not spend any more money, and be better off. No; he likes fruit and cheese more than other goods, so he should buy more of both. O No; he could buy less cheese and more fruit, not spend any more money, and be better off. (Pounds) 100 For each of the following combinations of cheese and fruit, calculate the marginal utility per dollar from the last pound of cheese and the last pound of fruit. Then, use the dropdown menus in the last column to indicate which of the combinations satisfy the condition for consumer equilibrium. 50 100 25 20 16 12 L 4 25 50 75 100 FRUIT (Pounds) 24 MU OF FRUIT (Utils per pound) Fruit 0 0 MU Pr 125 Consumer Equilibrium? 150 Suppose Andrew has an "appetizer budget" of $325 per month, which he spends on cheese and fruit. To maximize his utility, Andrew will purchase pounds of cheese and pounds of fruit per month.

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The detailed answer for the above question is provided below Answer No he could purchase less fruits ... View the full answer