1. Complete the following table and answer the questions below: Units consumed Total utility Marginal utility 1 10 10 3 25 4 30 3 6. 34 2. Columns 1 through 4 in the table below show the marginal utility, measured in utils, that Ricardo would get by purchasing various amounts of products A, B, C, and D. Column 5 shows the marginal utility Ricardo gets from saving. Assume that the prices of A, B, C, and D are P18, 6, 4, and 24, respectively, and that Ricardo has an income of 106. Column 1 Column 2 Column 3 Column 4 Column 5 Unit Unit Unit Unit No. of MU MU MU MU P saved MU of A of B of C of D 1 72 1 24 1 15 1 36 1 2 54 2 15 12 30 2 4 3 45 3 12 3 3 24 3 36 4 4 7 4 18 2 27 5 7 5 13 5 1 18 5 6 7 1/2 7 15 7 2 7 3.5 7 4 7 1/4 12 1 8. 8 1/8 What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility? a. b. How many pesos will Ricardo choose to save?
1. Complete the following table and answer the questions below: Units consumed Total utility Marginal utility 1 10 10 3 25 4 30 3 6. 34 2. Columns 1 through 4 in the table below show the marginal utility, measured in utils, that Ricardo would get by purchasing various amounts of products A, B, C, and D. Column 5 shows the marginal utility Ricardo gets from saving. Assume that the prices of A, B, C, and D are P18, 6, 4, and 24, respectively, and that Ricardo has an income of 106. Column 1 Column 2 Column 3 Column 4 Column 5 Unit Unit Unit Unit No. of MU MU MU MU P saved MU of A of B of C of D 1 72 1 24 1 15 1 36 1 2 54 2 15 12 30 2 4 3 45 3 12 3 3 24 3 36 4 4 7 4 18 2 27 5 7 5 13 5 1 18 5 6 7 1/2 7 15 7 2 7 3.5 7 4 7 1/4 12 1 8. 8 1/8 What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility? a. b. How many pesos will Ricardo choose to save?
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter6: Consumer Choice Theory
Section: Chapter Questions
Problem 3SQP
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Question
Transcribed Image Text:1. Complete the following table and answer the questions below:
Units consumed
Total utility
Marginal utility
1
10
10
2
8.
25
4
30
5
6.
34
2. Columns 1 through 4 in the table below show the marginal utility, measured in utils, that Ricardo
would get by purchasing various amounts of products A, B, C, and D. Column 5 shows the
marginal utility Ricardo gets from saving. Assume that the prices of A, B, C, and D are P18, 6, 4,
and 24, respectively, and that Ricardo has an income of 106.
Column 1
Column 2
Column 3
Column 4
Column 5
Unit
Unit
Unit
Unit
No. of
MU
MU
MU
MU
P saved
MU
of A
of B
of C
of D
|| || || || |
1
72
1
24
1
15
1
36
1
2
54
2
15
12
2
30
2
3
45
3
12
8
3
24
3
36
4
18
2
27
5
7
5
13
5
1
18
6.
7
6.
1/2
7
15
7
7
3.5
7
4
7
1/4
8
12
8.
1
8
2
8.
1/8
a. What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility?
b. How many pesos will Ricardo choose to save?
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