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1. Isobel consumes positive quantities of both jam and juice. The price of jam is 5 cents per unit and the price of juice is 10 cents per unit. Her marginal utility of jam is 10 and her marginal utility of juice is 5. a. We can't tell whether any of the other statements are true or false without knowing the quantities she consumes. b. Without changing her total expenditures on jam and juice, she could not increase her utility. c. Without changing her total expenditures, she could increase her utility by consuming more jam and less juice. d. She should spend more money on both jam and juice. e. Without changing her total expenditures, she could increase her utility by consuming more juice and less jam.

1. Isobel consumes positive quantities of both jam and juice. The price of jam is 5 cents per unit and the price of juice is 10 cents per unit. Her marginal utility of jam is 10 and her marginal utility of juice is 5. a. We can't tell whether any of the other statements are true or false without knowing the quantities she consumes. b. Without changing her total expenditures on jam and juice, she could not increase her utility. c. Without changing her total expenditures, she could increase her utility by consuming more jam and less juice. d. She should spend more money on both jam and juice. e. Without changing her total expenditures, she could increase her utility by consuming more juice and less jam.

Economics: Private and Public Choice (MindTap Course List)
Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter20: Consumer Choice And Elasticity
Section: Chapter Questions
Problem 4CQ
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1. Isobel consumes positive quantities of both jam and juice. The price of jam is 5 cents per unit and the price of juice is 10 cents per unit. Her marginal utility of jam is 10 and her marginal utility of juice is 5. a. We can't tell whether any of the other statements are true or false without knowing the quantities she consumes. b. Without changing her total expenditures on jam and juice, she could not increase her utility. c. Without changing her total expenditures, she could increase her utility by consuming more jam and less juice. d. She should spend more money on both jam and juice. e. Without changing her total expenditures, she could increase her utility by consuming more juice and less jam.
Transcribed Image Text:1. Isobel consumes positive quantities of both jam and juice. The price of jam is 5 cents per unit and the price of juice is 10 cents per unit. Her marginal utility of jam is 10 and her marginal utility of juice is 5. a. We can't tell whether any of the other statements are true or false without knowing the quantities she consumes. b. Without changing her total expenditures on jam and juice, she could not increase her utility. c. Without changing her total expenditures, she could increase her utility by consuming more jam and less juice. d. She should spend more money on both jam and juice. e. Without changing her total expenditures, she could increase her utility by consuming more juice and less jam.
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