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Suppose the price of an apple is $0.75, and the price of a banana is $0.50. If Hugh is maximizing his utility, and his marginal utility from consuming an apple is 24 utils, then his marginal utility from consuming a banana must be:________

a. 12 utils.
b. 16 utils.
c. 32 utils.
d. 36 utils.

Respuesta :

jepessoa

Answer:

b. 16 utils.

Explanation:

price of one apple = $0.75

marginal utility from consuming one apple = 24

utils per dollar (from apples) = 24 / $0.75 = 32 utils per dollar

since each banana costs $0.50, Hugh must be obtaining a marginal utility = 32/$ x $0.50 = 16 utils from one banana

when you maximize your marginal utility, the utils per dollar must be equal for both products

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