Douglas allocates his budget of $24 per week to 3 goods, cereal, books and clothing. Use the table below to answer the following question Quantity Total Utility of Cereal Total Utility of Books Total Utility of Clothing 1 50 75 25 2 90 135 45 3 120 175 60 4 140 205 70 5 155 225 78 1. If the price of cereal is $2, the price of books is $3 and the price of clothing is $1, at what point does Douglas maximize his utility? Explain.

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Chapter1: Making Economics Decisions
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  1. Douglas allocates his budget of $24 per week to 3 goods, cereal, books and clothing. Use the table below to answer the following question

Quantity

Total Utility of Cereal

Total Utility of Books

Total Utility of Clothing

1

50

75

25

2

90

135

45

3

120

175

60

4

140

205

70

5

155

225

78

1.    If the price of cereal is $2, the price of books is $3 and the price of clothing is $1, at what point does Douglas maximize his utility? Explain. 

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