Description of this paper

exhausting her money income by purchasing 10 units

Description

solution


Question

Suppose that Ms. Thomson is currently exhausting her money income by purchasing 10 units of A and 8 units of B at prices of $2 and $4 respectively. The marginal utility of the last units of A and B are 16 and 24 respectively. These data suggest that Ms. Thomson;A.has preferences that are at odds with the principle of diminishing marginal utility.;B.considers A and B to be complementary goods.;C.should buy less A and more B.;D.should buy less B and more A.

 

Paper#21605 | Written in 18-Jul-2015

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