Consider two goods, plane tickets and juice. Suppose Tim is to choose the optimal quantities of both goods. Use the following dropdown selections to identify the utility-maximizing rule Tim should follow to choose the optimal quantities. (Note: In the answer options that follow, MU stands for "marginal utility.") Since juice costs less than plane tickets, it must follow that when Tim chooses optimal quantities of juice and plane tickets, the marginal utility received from the last plane ticket is than the marginal utility from the last gallon of juice.
Consider two goods, plane tickets and juice. Suppose Tim is to choose the optimal quantities of both goods. Use the following dropdown selections to identify the utility-maximizing rule Tim should follow to choose the optimal quantities. (Note: In the answer options that follow, MU stands for "marginal utility.") Since juice costs less than plane tickets, it must follow that when Tim chooses optimal quantities of juice and plane tickets, the marginal utility received from the last plane ticket is than the marginal utility from the last gallon of juice.
Micro Economics For Today
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ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter6: Consumer Choice Theory
Section: Chapter Questions
Problem 3SQP
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Transcribed Image Text:4. Balancing utility and price
Consider two goods, plane tickets and juice. Suppose Tim is to choose the optimal quantities of both goods.
Use the following dropdown selections to identify the utility-maximizing rule Tim should follow to choose the optimal quantities. (Note: In the answer
options that follow, MU stands for "marginal utility.")
Since juice costs less than plane tickets, it must follow that when Tim chooses optimal quantities of juice and plane tickets, the marginal utility
received from the last plane ticket is
than the marginal utility from the last gallon of juice.
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