5. Max has $35 a day to spend on windsurfingand snorkeling and he can spend as muchtime as he likes doing them. The price ofrenting equipment for windsurfing is $10 anhour and for snorkeling is $5 an hour. Thetable shows the total utility Max gets fromeach activity.a Calculate Max's marginal utility fromwindsurfing at each number of hours perday. Does Max's marginal utility fromwindsurfing obey the principle ofHours perday1234C.56Total utilityfromwindsurfing120220300360396412422Total utilityfromsnorkeling4076106128140150158diminishing marginal utility?b. Calculate Max's marginal utility from snorkeling at each number of hours per day. DoesMax's marginal utility from snorkeling obey the principle of diminishing marginal utility?Which does Max enjoy more: his 6th hour of windsurfing or his 6th hour of snorkeling?

Consumer theory is the study of how people allocate their money and available monetary income based…

5. Max has $35 a day to spend on windsurfing and snorkeling and he can spend as much time as he likes doing them. The price of renting equipment for windsurfing is $10 an hour and for snorkeling is $5 an hour. The table shows the total utility Max gets from each activity. Hours per day 1 2 3 4 5 Total utility from windsurfing 120 220 7 300 360 396 412 422 Total utility from snorkeling 40 76 106 128 140 150 158. a Calculate Max's marginal utility from windsurfing at each number of hours per day. Does Max's marginal utility from windsurfing obey the principle of diminishing marginal utility? b. Calculate Max's marginal utility from snorkeling at each number of hours per day. Does Max's marginal utility from snorkeling obey the principle of diminishing marginal utility? c. Which does Max enjoy more: his 6th hour of windsurfing or his 6th hour of snorkeling?

5. Max has $35 a day to spend on windsurfing and snorkeling and he can spend as much time as he likes doing them. The price of renting equipment for windsurfing is $10 an hour and for snorkeling is $5 an hour. The table shows the total utility Max gets from each activity. Hours per day 1 2 3 4 5 Total utility from windsurfing 120 220 7 300 360 396 412 422 Total utility from snorkeling 40 76 106 128 140 150 158. a Calculate Max's marginal utility from windsurfing at each number of hours per day. Does Max's marginal utility from windsurfing obey the principle of diminishing marginal utility? b. Calculate Max's marginal utility from snorkeling at each number of hours per day. Does Max's marginal utility from snorkeling obey the principle of diminishing marginal utility? c. Which does Max enjoy more: his 6th hour of windsurfing or his 6th hour of snorkeling?

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter6: Consumer Choice And Demand

Section: Chapter Questions

Problem 2QFR

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Similar questions

Take Jeremys total utility information in Exercise 6.1, and use the marginal utility approach to confirm the choice of phone minutes and round trips that maximize Jeremys utility.
Would you expect total utility to rise or fall with additional consumption of a good? Why?
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Praxilla, who lived in ancient Greece, derives utility from reading poems and from eating cucumbers. Praxilla gets 30 units of marginal utility from her first poem 27 units of marginal utility from her second poem 24 units of marginal utility from her third poem, and so on, with marginal utility declining by three units for each additional poem. Praxilla gets six units of marginal utility for each of her next three cucumbers consumed, five units of marginal utility for each of her next three cucumbers consumed, four units of marginal utility for each of the following three cucumbers consumed, and so on, with marginal utility declining by one for every three cucumber consumed. A poem costs three bronze coins hut a cucumber costs only one bronze coin. Praxilla has 18 bronze coins. Sketch Praxillas budget set between poems and cucumbers, placing poems on the vertical axis and cucumbers on the horizontal axis. Start off with the choice of zero poems and 18 cucumbers, and calculate the changes in marginal utility of moving along the budget line to the next choice of one poem and 15 cucumbers. Using this step-by-step process based on marginal utility, create a table and identify Praxillas utilityâ€”maximizing choice. Compare the marginal utility of the two goods and the relative prices at the optimal choice to see if the expected relationship holds. Hint: Label the table columns: 1) Choice, 2} Marginal Gain from More Poems, 3) Marginal Loss from Fewer Cucumbers, 4) Overall Gain or Loss, 5) Is the previous choice Optimal? Label the table rows: 1) 0 Poems and 18 Cucumbers, 2) 1 Poem and 15 cucumbers, 3) 2 Poems and 12 cucumbers, 4) 3 Poems and 9 Cucumbers, 5) 4 Poems and 6 cucumbers 6) 5 Poems and 3 Cucumbers, 7) 6 Poems and 0 Cucumbers.
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