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
Chapter10: Consumer Choice Theory
Section: Chapter Questions
Problem 1P
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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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