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In the Diagram, Suppose the Consumer Is Currently Exhausting His

Question 348

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In the diagram, suppose the consumer is currently exhausting his or her income at a point where the marginal rate of substitution of apples for oranges is greater than <sup>5</sup>/₄. That is, MUA/MU0><sup>5</sup>/₄. To maximize utility, the consumer should move from point A) a to e. B) b to e. C) c to e. D) d to e. In the diagram, suppose the consumer is currently exhausting his or her income at a point where the marginal rate of substitution of apples for oranges is greater than 5/₄. That is, MUA/MU0>5/₄. To maximize utility, the consumer should move from point


A) a to e.
B) b to e.
C) c to e.
D) d to e.

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