Suppose that Akbar has consumed two goods Ice cream and apple juice. Details of MUice-cream and MUapple_juice are given in the following table. Akbar's income is Rs.100 and the price of Ice-cream is Rs.20 and the price of apple juice is Rs.20. Units 1 2 3 4 7 10 MUice-cream 300 290 260 230 190 160 120 80 60 20 MUapple_juice 240 220 200 130 125 110 80 40 -5 a. Determine how much total utility Akbar receives when he purchases the combination of Ice-cream and Apple Juice that maximizes total utility? b. How much total utility would the Akbar get if he spends all his income on Apple Juice? c. How much total utility would the Akbar get if he spends all his income on Ice-Cream?
Suppose that Akbar has consumed two goods Ice cream and apple juice. Details of MUice-cream and MUapple_juice are given in the following table. Akbar's income is Rs.100 and the price of Ice-cream is Rs.20 and the price of apple juice is Rs.20. Units 1 2 3 4 7 10 MUice-cream 300 290 260 230 190 160 120 80 60 20 MUapple_juice 240 220 200 130 125 110 80 40 -5 a. Determine how much total utility Akbar receives when he purchases the combination of Ice-cream and Apple Juice that maximizes total utility? b. How much total utility would the Akbar get if he spends all his income on Apple Juice? c. How much total utility would the Akbar get if he spends all his income on Ice-Cream?
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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