eLuis has $ 8 to spend a week on pizzas and books The price of the pizzas is $ 2 and the price of the books is $ 2 per unit Calculate the following: a) Marginal utility and marginal utility per dollar...


eLuis has $ 8 to spend a week on pizzas and books The price of the pizzas is $ 2 and the price of the books is $ 2 per unit




Calculate the following:


a) Marginal utility and marginal utility per dollar when he buys 4 pizzas a week


b) Marginal utility and marginal utility per dollar when he buys 3 books a week


c) If Luis buys 4 pizzas and 3 books per week, does he maximize his total utility? If not, what should he do to maximize it?




The following table presents the total utility of Luis related to pizzas and the books he buys per week




          Pizza                                                     Books
Quantity by Week Cost      Total Utility      Quantity by Week       Total Utility


             0                               0                             0                      0


             1                              14                            1                     100


             2                              24                            2                     120


             3                              34                           3                      134


             4                              38                           4                      144






May 16, 2022
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