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Gillian Is Consuming Her Optimal Consumption Bundle of Peanuts and Raisins

Question 309

Multiple Choice

Gillian is consuming her optimal consumption bundle of peanuts and raisins. The marginal utility associated with the last peanut she consumes is 4 utils, and the marginal utility associated with the last raisin is 2 utils. What must be the price of peanuts relative to that of raisins?


A) 0.5
B) 1
C) 2
D) The relative price is undefined.

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