Include correctly labeled diagrams, if useful or required, in explaining your answers. A correctly

labeled diagram must have all axes and curves clearly labeled and must show directional changes. If the

question prompts you to "Calculate," you must show how you arrived at your final answer.

The table below shows the marginal utilities in utils that Sarah derives from consuming two goods,

snacks, and movies.

Quantity of

Snacks

Marginal

Utility of

Snacks

Quantity of

Movies

Marginal

Utility of

Movies

0 - 0 -

1 20 1 50

2 18 2 35

3 15 3 24

4 12 4 20

5 10 5 15

6 8 6 10

Sarah has a limited weekly income of $50, and she spends it all on snacks and movies. Assume the

price of snacks is $5 per unit, the price of a movie ticket is $10, and Sarah is a utility-maximizing

consumer.

(a) Would Sarah be able to consume 3 snacks and 5 movies? Explain.

(b) How many snacks and movies will Sarah consume to maximize her utility? Explain.

(c) Calculate the total utility Sarah will receive from consuming the utility-maximizing combination of

snacks and movies indicated in your answer in part (a). Show your work.

(d) Suppose Sarah's income increases to $60.

(i) What will happen to the marginal utility per dollar spent on movies?

(ii) Will Sarah be better off buying two more snacks or one more movie ticket? Explain.