Question

find average utility if total utility of 7 commodities is 70 units

Answer 1

Answer:

Consumer attains equilibrium when:

P

x

MU

x

=MU of Money

or, when MU

x

=P

x

. MU of Money,

Substuting the given values, the consumer attains equlibrium when:

MU

x

=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.

Answer 2

Answer:

Answer:

This answer only can solve in graph paper only.

Hint: 7-70

6-60

5-50

4-40

3-30

2-20

1-10

0-0

Explanation: