A consumer finds only three products, X, Y, and Z. are for sale. The amount of...

 

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A consumer finds only three products, X, Y, and Z. are for sale. The amount of utility yielded by their consumption is shown in the table below. Assume that the prices of X, Y, and Z are $10, 52, and $8, respectively, and that the consumer has an income of $74 to spend taj Complete the following table by computing the marginal unity per dolar for successive units of X, Y, and Z to one or two decimal places (b) How many units of X, Y, and Z will the consumer buy when maximizing utility and spending all income? Show this result using the utility maximization formula (c) Why would the consumer not be maximizing utility by purchasing 2 units of X, 4 units of Y, and 1 unit of 27 Product X Product Y Quantity Utility Marginal Quantity Utility Marginal Utility pers Utility per$ 42 82 118 4 148 S 170 6 182 7 182 1 2 3 1 2 3 4 5 6 7 14 26 36 44 S 50 54 56.4 Product Z Quantity Utility Marginal Utility pers 1 2 3 4 5 6 7 8838228 60 100 110 116 120 A consumer finds only three products, X, Y, and Z. are for sale. The amount of utility yielded by their consumption is shown in the table below. Assume that the prices of X, Y, and Z are $10, 52, and $8, respectively, and that the consumer has an income of $74 to spend taj Complete the following table by computing the marginal unity per dolar for successive units of X, Y, and Z to one or two decimal places (b) How many units of X, Y, and Z will the consumer buy when maximizing utility and spending all income? Show this result using the utility maximization formula (c) Why would the consumer not be maximizing utility by purchasing 2 units of X, 4 units of Y, and 1 unit of 27 Product X Product Y Quantity Utility Marginal Quantity Utility Marginal Utility pers Utility per$ 42 82 118 4 148 S 170 6 182 7 182 1 2 3 1 2 3 4 5 6 7 14 26 36 44 S 50 54 56.4 Product Z Quantity Utility Marginal Utility pers 1 2 3 4 5 6 7 8838228 60 100 110 116 120

Answer rating: 100% (QA)

a To compute the marginal utility per dollar for successive units of X Y and Z we need to calculate the change in utility for each additional unit div... View the full answer