Ask Question
12 July, 20:11

Amy purchased four cantaloupes at $2 each and three watermelons at $4 each. If Amy is following the optimal consumption rule, the marginal utility of the fourth cantaloupe and third watermelon are: Select one: a. 4 and 3, respectively. b. 40 and 10, respectively. c. 12 and 24, respectively. d. 6 and 8, respectively.

+5
Answers (1)
  1. 12 July, 20:25
    0
    C) 12 and 24, respectively.

    Explanation:

    The optimal consumption rule states that to maximize utility, a customer's marginal utility per dollar spent should be equal for all goods purchased.

    In this case since watermelons' price is twice the cantaloupes' price, then their marginal utility should be double also.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Amy purchased four cantaloupes at $2 each and three watermelons at $4 each. If Amy is following the optimal consumption rule, the marginal ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers