Question

4. You spend all your money on goods X and Y. In utility terms, the marginal cost of spending a dollar on good X is equal to a. The marginal utility of good X b. The marginal utility of good X per dollar C. The marginal utility of good Y d. The marginal utility of good Y per dollar e. The price of good X 5. Seema has $20 for coffee (C) and nuts (N), with pc = $2 and PN = $4. The table shows Seema's marginal utility. The utility-maximizing bundle is C = _and N = -_ Quantity 1 2 3 4 5 6 7 8 Quantity 1 2 3 4 5 6 7 8 Coffee 10 8 6 4 2 0 -2 -4 Nuts 20 12 8 4 0 0 -10 -20

Answer 1

@ marginal cost of spending a dollar on good x is equal to marginal utility of good Y per dollar IN=4 Quantity Coffee (ru) MUx | Quantity I MUN I MUN 10 Nute - 8 LOLO -2 T- 9 T-2 O I 1-25 - 20 1 - 5 C = 4 income = $20. to spend (c = "4 and N=3]