Question

Question# 1 u are attending a championship soccer match withy In your pocket only (40) Saudi Riyals to spend on po C), supposed to allocate such a mount to maximiz of the consumption of the two goods, where the price SR and (4) SR for a coke, looking at the table below MUc/ Various MUs MUs/Ps MUC levels of S and C 3 120 680 40 32 40 30 25 20 15 2. 나 4. 5. 6. 1016 MUs-marginal utility of popcorn, Ps-price of popcorn MUc-marginal utility of coke, Pc-price of coke Answer the followings 1. Fill up the blanks above? 2. Find the combination of popcorns and cokes yields evel of utility, subject to the budget constraint?

Answer 1

Mus Mus/Ps Muc/Pc Muc 3 15 Qc Expenditure

The equilibrium is determined by the condition MUs/Ps = MUc/PC

Also at this point the consumer must spent all of his given income of SR20, which is 4 units of popcorn and 5 units of coke to maximise utility with given income of 20 SAR.