The table shows Regina's marginal utility numbers for ham- burgers and pizzas. Regina is trying to decide which item to purchase first, a hamburger or a pizza, knowing that she wants to receive the most utility for each dollar she spends. Assuming she has enough money in her budget to purchase either item, which item should she purchase first?

The table shows Regina's marginal utility numbers for ham- burgers and pizzas. Regina is trying to decide which item to purchase first, a hamburger or a pizza, knowing that she wants to receive the most utility for each dollar she spends. Assuming she has enough money in her budget to purchase either item, which item should she purchase first?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

There are only two brands of tennis balls Tom purchases: "Wilson" and "Penn." The more he purchases of a ball, the lower the marginal utility of that ball. He spends all of his income and his marginal utility of a "Wilson" is 6 and his marginal utility of an "Penn" is 12. The price of a "Wilson" ball is $1 and the price of an "Penn" is $2. Which of the statements is true based on the above information? Question 19 options: Tom could increase his satisfaction by a) trading "Wilson" for "Penn." In equilibrium, Tom must give up b) three "Penn" balls for two "Wilson" balls. Tom can increase his satisfaction by c) doing nothing Tom would be willing to give up two d) "Penn" balls for one "Wilson" ball.
A consumer has a budget set aside for entertainment during the year, and they spend the budget on concerts and plays. The consumer has a strong preference for attending concerts over plays: the two activities are substitutes, but not very strong substitutes. Sketch the indifference curves for this consumer on a graph, with concert tickets on the vertical axis and play tickets on the horizontal axis. Briefly explain why the consumer might ultimately choose to purchase a large number of play tickets, even though they have a strong preference for concerts. Include a budget line on your graph to illustrate this case.
Rubyhas just finished her economics exam and must decide whether to spend two hours going to the beauty parlour, having a couple of pizzas, or going to a movie. She can do one, all, or any two of these things. The question is, what should she do? The marginal utility of the beauty parlour serviceis 36 utils and the price is $6. The marginal utility of the two pizzasis 24 utils and the price is $4 for two pizzas. The marginal utility of going to the movie is 40 utils and the price is $10. Ruby's marginal utility of a dollar is 5 utils per dollar.
Marginal utility is equal to?
How can else increase marginal utility and therefore the consumer demand curve?
Larry and Teri allocate their consumption between two goods: hats and bats. The price of hats is €5 each, and the price of bats is €10 each. For Larry, the marginal utility of the last hat consumed was 8, and the marginal utility of the last bat was 24. For Teri, the marginal utility of the last hat was 6, and the marginal utility of the last bat was 12. Which consumer is not maximizing his/her utility? How can you tell? How should he/she change their allocation?
What is the axiom of consumer choice that implies that consumers spend all their income in order to maximize utility?
If we consume an additional unit of goods when utility is maximum, the utility we get from this additional unit is (positive, negative or zero)? Choose one why?