Multiple Choice
Suppose a consumer is spending all of his/her income on two goods, A and B, in a manner where MUa = 15 and MUb = 75, and the Pa = $3 and the Pb = $15, then the consumer:
A) is maximizing his/her utility.
B) should increase his/her purchases of B and decrease the purchases of A.
C) should spend more money on both goods.
D) should spend less money on both goods.
E) should increase the purchases of A and decrease the purchases of B.
Correct Answer:

Verified
Correct Answer:
Verified
Q59: The law of diminishing marginal utility exists
Q75: Consider a consumer who spends all income
Q154: Suppose you have spent your entire budget
Q242: The marginal utilities associated with the first
Q243: Exhibit 6A-7 Consumer equilibrium<br> <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB6121m/.jpg" alt="Exhibit
Q244: An indifference curve has a negative slope
Q245: Given the prices of two goods, all
Q246: "As consumption of a good increases, the
Q249: The income effect is the concept that
Q250: Exhibit 6-3 Marginal utility data for