Columns 1 through 4 of the accompanying table 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 $18, $6, $4, and $24, respectively, and that Ricardo has an income of $105. What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility? How many dollars will Ricardo choose to save? Check your answers by substituting them into the algebraic statement of the utility‑maximizing rule. In other words, show it works when using this rule. Column 1UnitsColumn 2Column 3UnitsColumn 4UnitsUnitsof AMUof BMUof CMUof DMU7212411513654215212230453123832436447418527755136186564677157273.574812813821234

choice Potential choices MU/P DECISION LEFT OVER INCOME 1 FIRST UNIT OF A 4 BUY FIRST UNIT OF A…

Answered: olumns 1 through 4 of the accompanying…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Columns 1 through 4 of the accompanying table 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 $18, $6, $4, and $24, respectively, and that Ricardo has an income of $105.

What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility?

How many dollars will Ricardo choose to save?

Check your answers by substituting them into the algebraic statement of the utility‑maximizing rule. In other words, show it works when using this rule.