Question

you are given the following marginal utilities of pizza and burger obtained by a consumer . Given that price of x= rs 5 , price of y= rs 2 and income=22 find out the optimal combination of goods (assuming that consumers spends his entire income)
number of unit​

Answer 1

Answer:

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Answer 2

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.

Explanation:

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