Consider an individual with preferences over two goods. This consumer is maximising utility when: a) They receive the same utility from each good. b) They spend the same amount of money on each good. c) The MRS is greater than the ratio of the prices of the two goods. d) None of the above

Consider an individual with preferences over two goods. This consumer is maximising utility when: a) They receive the same utility from each good. b) They spend the same amount of money on each good. c) The MRS is greater than the ratio of the prices of the two goods. d) None of the above

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter10: Consumer Choice Theory

Section: Chapter Questions

Problem 1P

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Question

1) Consider an individual with preferences over two goods. This consumer is maximising utility when:

a) They receive the same utility from each good.

b) They spend the same amount of money on each good.

c) The MRS is greater than the ratio of the prices of the two goods.

d) None of the above.

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