Question

Calculate Marginal Utility and Average Utility from the information given in the below
table:
Quantity Consumed Total Utility
1 20
2 35
3 47
4 55
5 60

Answer 1

60 55 47 35 20 is the answer

Answer 2

Answer:

Consumer attains equilibrium when:

$\frac{mu \times }{p \times } = mu \: of \: money \:$

or, when MUx =Px. MU of Money,

Substuting the given values, the consumer attains equlibrium when:

MUx=6×1=6.

Implying that the equilibrium is attained when 4 units of the commodity are purchased. (The table show that when MU

X

=6,4) units are purchased )

Therefore, the consumer should purchase 4 units in order maximum satisfaction.