1. Complete the following table and answer the questions below: Units consumed Total utility Marginal utility 1 10 10 3 25 4 30 3 6. 34 2. Columns 1 through 4 in the table below show the marginal utility, measured in utils, that Ricardo would get by purchasing various amounts of products A, B, C, and D. Column 5 shows the marginal utility Ricardo gets from saving. Assume that the prices of A, B, C, and D are P18, 6, 4, and 24, respectively, and that Ricardo has an income of 106. Column 1 Column 2 Column 3 Column 4 Column 5 Unit Unit Unit Unit No. of MU MU MU MU P saved MU of A of B of C of D 1 72 1 24 1 15 1 36 1 2 54 2 15 12 30 2 4 3 45 3 12 3 3 24 3 36 4 4 7 4 18 2 27 5 7 5 13 5 1 18 5 6 7 1/2 7 15 7 2 7 3.5 7 4 7 1/4 12 1 8. 8 1/8 What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility? a. b. How many pesos will Ricardo choose to save?

1. Complete the following table and answer the questions below: Units consumed Total utility Marginal utility 1 10 10 3 25 4 30 3 6. 34 2. Columns 1 through 4 in the table below show the marginal utility, measured in utils, that Ricardo would get by purchasing various amounts of products A, B, C, and D. Column 5 shows the marginal utility Ricardo gets from saving. Assume that the prices of A, B, C, and D are P18, 6, 4, and 24, respectively, and that Ricardo has an income of 106. Column 1 Column 2 Column 3 Column 4 Column 5 Unit Unit Unit Unit No. of MU MU MU MU P saved MU of A of B of C of D 1 72 1 24 1 15 1 36 1 2 54 2 15 12 30 2 4 3 45 3 12 3 3 24 3 36 4 4 7 4 18 2 27 5 7 5 13 5 1 18 5 6 7 1/2 7 15 7 2 7 3.5 7 4 7 1/4 12 1 8. 8 1/8 What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility? a. b. How many pesos will Ricardo choose to save?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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