Question

Refer to the above table and assume that each year this consumer buys only annual subscriptions to economics statistics apps and subscriptions to office productivity apps. The price of a subscription to each type of economics statistics app is ​$4 per​ year, and the subscription to each office productivity app is ​$40 per year. If the​ consumer's available income is ​$164 per​ year, he will purchase a quantity of nothing economics statistics apps and nothing office productivity apps each year at a consumer optimum.

Quantity	Utils	Marginal Utility	MUecon / Pecon	Quantity	Utils	Marginal Utility	MUoffice / Poffice
1	30			1	600
2	50			2	1100
3	60			3	1500
4	68			4	1800
5	72			5	2000
6	75			6	21000

I need to understand how to arrive at the marginal utility and the MUecon / Pecon and MUoffice / Poffice, so please show how you arrived at the answers.

Answer 1

Ans:

Marginal utility = change in total utility / change in quantity

Marginal utility per dollar = marginal utility / price

Quantity	Utility	Marginal utility	MUecon / Pecon	Quantity	Utility	Marginal utility	MUoffice / Poffice
1	30	30	7.5	1	600	600	15
2	50	20	5	2	1100	500	12.5
3	60	10	2.5	3	1500	400	10
4	68	8	2	4	1800	300	7.5
5	72	4	1	5	2000	200	5
6	75	3	0.75	6	2100	100	2.5

, The decision should be based on marginal utility per dollar.

In order to maximize utility, consumer should buy 4 units of office productivity apps and 1 unit of economics statistics apps.

Answer 2

Homework:Chapter 20 Homewor

Quantity of Subscriptions to Economics Statistics Apps per Year	Total Utility (utils)	Quantity of Subscriptions to Office Productivity Apps per Year	Total Utility (utils)
1	30	1	600
2	50	2	1,100
3	60	3	1,500
4	68	4	1,800
5	72	5	2,000
6	75	6	2,100

Refer to the above table and assume that each year this consumer buys only annual subscriptions to economics statistics apps and subscriptions to office productivity apps. The price of a subscription to each type of economics statistics app is

$4

per year, and the subscription to each office productivity app is

$60

per year. If the consumer's available income is

$248

per year, he will purchase a quantity of

nothing

economics statistics apps and

nothing

office productivity apps each year at a consumer optimum.