In Spending All His Income on Beer and Pizza, Fred

Multiple Choice

In spending all his income on beer and pizza, Fred finds that the marginal utility of the last pizza he consumed is 8, and the marginal utility of the last bottle of beer is 4. The price of a bottle of beer is $1.50. If Fred has maximized his utility, the price of pizza must be

A) $0.75.
B) $1.00.
C) $3.00.
D) $4.50.