The total utilities of the first 5 units of good X are 10,19, 26, 33, and 40 utils, respectively. In other words, the total utility of 1 unit is 10 utils, the total utility of 2 units is 19 utils, and so on. What is the marginal utility of the third unit?
The total utilities of the first 5 units of good X are 10,19, 26, 33, and 40 utils, respectively. In other words, the total utility of 1 unit is 10 utils, the total utility of 2 units is 19 utils, and so on. What is the marginal utility of the third unit?
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Jackson has $10, which he plans to allocate among three rides at the amusement park. Each ride on the Roller Coaster costs $3.00, on the Bumper Cars, $2.00, and on Splatter Mountain, $1.00. The Table below shows Jackson's utility schedule for the three rides. Given Jackson's budget constraint, what is the maximum utility he can receive from amusement park rides?
# OF RIDES |
MARGINAL UTILITY FROM BUMPER CARS |
MARGINAL UTILITY FROM SPLATTER MOUNTAIN |
MARGINAL UTILITY FROM ROLLER COASTER |
1 |
200 |
240 |
150 |
2 |
100 |
150 |
90 |
3 |
60 |
50 |
60 |
4 |
10 |
30 |
30 |
5 |
0 |
20 |
9 |
6 |
-72 |
10 |
0 |
A)We don't have enough information to answer this question.
B)300 utils
C)890 utils.
D)850 utils
E)550 utils
Consider a rational utility maximizing consumer who is choosing between two goods clothing (C) and food (F), where the total utilities of the two goods are independent so that total utility (U) = Utility from clothing + Utility from food. Assume that the utility from these items is outlined below:
Quantity consumed of Food (F): | 0 | 1 | 2 | 3 | 4 | 5 |
Utility from F (in utils): | 0 | 12 | 20 | 24 | 26 | 27 |
Quantity of clothing (C): | 0 | 1 | 2 | 3 | 4 | 5 |
Total Utility from C: (in utils): | 0 | 40 | 70 | 90 | 100 | 100 |
Assume further that the price of clothing is $5 per unit and the price of food is $1 per unit, and that the consumer has $18 to spend on the two goods in a given period. Carefully explain how the rational utility maximizing consumer would allocate his/her expenditures on the two goods.