what is the solution A child is given $4 of pocket money to be spent on either hard candies or chocolates. Chocolates cost 40 cents and hard candies 50 cents each. The marginal utilities derived from each product are as shown in thefollowing table.Number of ItemsMU of ChocolatesMU of Hard Candies601502.501404012030100520806.1070550820If the child buys either chocolates or hard candies one piece at a time, what will be his first two purchases?Multiple Choicea hard candy, followed by another hard candya hard candy, followed by a chocolatea chocolate, followed by a hard candya chocolate, followed by another chocolate

Economics as a subject deals with the allocation of scarce resources among humans with unlimited…

A child is given $4 of pocket money to be spent on either hard candies or chocolates. Chocolates cost 40 cents and hard candies 50 cents each. The marginal utilities derived from each product are as shown in following table. Number of Items MU of Chocolates MU of Hard Candies 60 150 50 140 3 40 120 4. 30 100 5. 20 80 6 10 70 7 5 50 8 20 If the child buys either chocolates or hard candies one piece at a time, what will be his first two purchases? Multiple Choice a hard candy, followed by another hard candy a hard candy, followed by a chocolate a chocolate, followed by a hard candy a chocolate, followed by another chocolate

A child is given $4 of pocket money to be spent on either hard candies or chocolates. Chocolates cost 40 cents and hard candies 50 cents each. The marginal utilities derived from each product are as shown in following table. Number of Items MU of Chocolates MU of Hard Candies 60 150 50 140 3 40 120 4. 30 100 5. 20 80 6 10 70 7 5 50 8 20 If the child buys either chocolates or hard candies one piece at a time, what will be his first two purchases? Multiple Choice a hard candy, followed by another hard candy a hard candy, followed by a chocolate a chocolate, followed by a hard candy a chocolate, followed by another chocolate

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter6: Consumer Choice Theory

Section: Chapter Questions

Problem 3SQP

See similar textbooks

Similar questions

Jeremy is deeply in love with Jasmine. Jasmine lives where cell phone coverage is poor, so he can either call her on the land-line phone for five cents per minute or he can drive to see her, at a roundâ€”trip cost of 2 in gasoline money. He has a total of 10 per week to spend on staying in touch. To make his preferred choice, Jeremy uses a handy utilimometer that measures his total utility from personal visits and from phone minutes. Using the values in Table 6.6, figure out the points 011 Jeremys consumption choice budget constraint (it may be helpful to do a sketch) and identify his utility-maximizing point.
Would you expect total utility to rise or fall with additional consumption of a good? Why?
Praxilla, who lived in ancient Greece, derives utility from reading poems and from eating cucumbers. Praxilla gets 30 units of marginal utility from her first poem 27 units of marginal utility from her second poem 24 units of marginal utility from her third poem, and so on, with marginal utility declining by three units for each additional poem. Praxilla gets six units of marginal utility for each of her next three cucumbers consumed, five units of marginal utility for each of her next three cucumbers consumed, four units of marginal utility for each of the following three cucumbers consumed, and so on, with marginal utility declining by one for every three cucumber consumed. A poem costs three bronze coins hut a cucumber costs only one bronze coin. Praxilla has 18 bronze coins. Sketch Praxillas budget set between poems and cucumbers, placing poems on the vertical axis and cucumbers on the horizontal axis. Start off with the choice of zero poems and 18 cucumbers, and calculate the changes in marginal utility of moving along the budget line to the next choice of one poem and 15 cucumbers. Using this step-by-step process based on marginal utility, create a table and identify Praxillas utilityâ€”maximizing choice. Compare the marginal utility of the two goods and the relative prices at the optimal choice to see if the expected relationship holds. Hint: Label the table columns: 1) Choice, 2} Marginal Gain from More Poems, 3) Marginal Loss from Fewer Cucumbers, 4) Overall Gain or Loss, 5) Is the previous choice Optimal? Label the table rows: 1) 0 Poems and 18 Cucumbers, 2) 1 Poem and 15 cucumbers, 3) 2 Poems and 12 cucumbers, 4) 3 Poems and 9 Cucumbers, 5) 4 Poems and 6 cucumbers 6) 5 Poems and 3 Cucumbers, 7) 6 Poems and 0 Cucumbers.
As a college student you work at a part-time job, but your parents also send you a monthly allowance. Suppose one month your parents forgot to send the check. Show graphically how your budget constraint is affected. Assuming you only buy normal goods, what would happen to your purchases of goods?
Take Jeremys total utility information in Exercise 6.1, and use the marginal utility approach to confirm the choice of phone minutes and round trips that maximize Jeremys utility.
Draw Maries budget constraint with pies on the horizontal axis and magazines on the vertical axis. What is the slope of me budget constraint?
Is it possible for total utility to increase while marginal utility diminishes? Explain.
TU TU of MU Qfood food MU food MU/p Drink drinks drinks MU/p 0 0 1 30 2 55 3 75 956 90 100 012345 0 30 57 7 105 106 67 78 93 102 108 111 The marginal utility for consuming the 3rd unit of food is utility for consuming the 5th unit of drinks is ? and the margina 20; 9 75; 102 15;8 There is not enough information to tell O What am I doing in this class? Why don t I know the answer to these? (This is an incorrect answer)
Table A – Faris Daily Consumption Dozens of Oysters Total Utility Marginal Utility per Day 1 60 104 3 134 4 152 5 160 Number of Total Utility Marginal Utility Root Beers per Day 1 40 70 3 94 4 114 5 128 Refer to Table A shows Faris's consumption on the oysters and root beers per day for a total five days; i. Compute Faris's marginal utility of for consumption of dozens of oyster and number of root beers per day ii. At what units per day Faris's Diminishing Marginal Utility sets in for consumption of dozens of oyster and number root beers per day. iii. Please briefly explain why Faris will experience the Diminishing Marginal Utility as he consumes more unit of oysters and root beers.
Explain, Why is the marginal utility curve declining with incresed consumpition of burgers?
Randy lives on Cheetos and chocolates. The price of Cheetos is 3 dollar per bag and the price of chocolates is 6 dollars each. Randy allows himself to spend no more than 33 dollars a day on food. He also restricts his consump- tion to 6,500 calories per day. There are 1,500 calories in a bag of Cheetos and 500 calories in a chocolate.. If he spends his entire money budget each day and consumes no more calories than his calorie limit, up to how many bags of Cheetos can Randy consume per day?
Bill gets 100 utils from eating one candy bar per day. He gets 120 utils from eating two candy bars per day. Calculate the marginal utility. O. 220 utils 100 utils 120 utils 20 utils Tamera calculates her utility for two hours of studying each day to be 300 utils. Her total utility for three hours is also 300 utils. Calculate the marginal utility. 300 utils 600 utils O 150 utils no marginal utility