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58 Utils

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Exercise
Answer the question on the basis of the following total utility data for products
L and M. Assume that the prices of L and M are $3 and $4, respectively, and
that the consumer’s income is $18. Complete this table (2 extra points).
Units of
Total
MU
MU/Price Units of
Total
– H N m
Utility (L)
MU MU/Price
SHNM JU
Utility (M)
(M)
(M)
1. How many units of the two
2. What level of total utility does the
products will the rational
rational consumer realize in
consumer purchase?
equilibrium?
A. 3 of L and none of M
A. 87 utils
B. 4 of L and 2 of M
B. 104 utils
C. 3 of L and 5 of M
C. 51 utils
D. 2 of L and 3 of M
D. 58 utilsEconomics