Multiple Choice
Tyrell has $50 to spend on good A and good B per week. The price of good A is $5 and that of good B is $4. He buys six units of good A and five units of good B. The marginal utility of the sixth unit of A is 25 units, and the marginal utility of the fifth unit of B is 20 units. Which of the following is true?
A) He is maximizing his utility.
B) His last dollar spent on good A exceeds the last dollar spent on good B.
C) He is not maximizing his utility and should buy more of A.
D) He is not maximizing his utility and should buy more of B.
E) He is not maximizing his utility because he is not spending all of his income.
Correct Answer:

Verified
Correct Answer:
Verified
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