Suppose a consumer has a budget of $100 to spend on concerts (price = $6) and carnival

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Suppose a consumer has a budget of $100 to spend on concerts (price = $6) and carnival rides (price = $2). For each of the following pairs of points in the figure below, indicate whether the pair (i) satisfies the budget constraint, (ii) satisfies the equimarginal rule, or (iii) is the best affordable bundle.


Utils 32 28 a MU per $ b d 9 12 15 Concerts Utils MU per $ e Rides 23


a. Points a and e.

b. Points b and h.

c. Points c and f.

d. Points d and g.

e. Points d and e.

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Microeconomics Principles Applications And Tools

ISBN: 9780134078878

9th Edition

Authors: Arthur O'Sullivan, Steven Sheffrin, Stephen Perez

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