8 of 15Izzy who consumes only grilled chicken sandwiches and salads with low-fat dressing, has a weekly income of $50. She is currently consuming 5 grilled chicken sandwiches perweek, at a price of $6 each, and 2 salads per week, at a price of $10 each. If the last sandwich and the last salad both added 15 units to Izzy's total utility:O A. She is making the utility-maximising choiceOB. She should buy more salads and fewer sandwichesOC. She should buy more sandwiches and fewer saladsO D. She obtains more additional utility per dollar from salads than from sandwichesBoth B and D.O No answer.

The objective of the question is to determine whether Izzy is making the utility-maximising choice…

Answered: 8 of 15 Izzy who consumes only grilled…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Q36
Amadea spends all her income on pizza,chocolate milk, and music streams. The price of pizza is $4 per slice and price ofchocolate milk $2 per bottle. At Amadea's current consumption level, her marginalutility for pizza is 50 units per slice and for music 100 units per stream. Assuming thatAmadea is a utility maximizer, how much is (a)her current marginal utility for a bottleof chocolate milk, and (b) the price of streams she buys. Show your work. [Hint: Ch 6:Utility-maximizing formula)
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