Question

es of Microeconomics urses / FIC 202001 ECON1034_DUSK / Midterm 2 Week (March 23-27) / Midterm 2 If a consumer purchases a combination of dish soap and floor wax such that MU Dish soap/PDish soap = 50 and MU Floor was/P floor wax = 30, to maximize utility, the consumer should buy Select one a more bottles of soap and floor wax b. fewer bottles of soap and more bottles of floor wax c. fewer bottles of soap and floor wax d more bottles of soap and fewer bottles of floor wax Next page uz Friday March 27 8:0 Jump to - Ch 12 Assignment ANSWERS $ 35

Answer 1

(MUDish soap / PDish soap  ) = 50

(MUFloor wax / PFloor wax) = 30

Consumer maximizes utility at the following point.

(MUDish soap / PDish soap  ) = (MUFloor wax / PFloor wax)

(MUDish soap / PDish soap  ) >  (MUFloor wax / PFloor wax)

It implies in order to maximize utility, the consumer should buy more bottles of soap and fewer bottles of floor wax.

So that (MUDish soap / PDish soap  ) decrease and (MUFloor wax / PFloor wax) increase & consumer attained the utility-maximizing condition.  

Answer: Option (D)