You are choosing between two goods, X and Y, and your marginal utility from each is shown in the following table. Units of X MUX Units of Y MUy 1 23 1 18 2 16 2 16 3 12 3 14 4 8 4 10 5 4 6 2 5 6 8 4 Instructions: Enter your answers as a whole number. a. If your income is $9 and the prices of X and Y are $2 and $1, respectively, what quantities of each will you purchase to maximize utility? units of X and units of Y b. What total utility will you realize? utils c. Assume that, other things remaining unchanged, the price of X falls to $1. What quantities of X and Y will you now purchase? units of X and units of Y

Microeconomics
13th Edition
ISBN:9781337617406
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter7: Consumer Choice: Maximizing Utility And Behavioral Economics
Section: Chapter Questions
Problem 3WNG
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You are choosing between two goods, X and Y, and your marginal utility from each is shown in the following table.
Units of X
MUX
Units of Y
MUY
1
23
1
18
2
16
2
16
3
12
3
14
4
8
4
10
5
4
5
6
2
6
8
4
Instructions: Enter your answers as a whole number.
a. If your income is $9 and the prices of X and Y are $2 and $1, respectively, what quantities of each will you purchase to maximize
utility?
units of X and
units of Y
b. What total utility will you realize?
utils
c. Assume that, other things remaining unchanged, the price of X falls to $1. What quantities of X and Y will you now purchase?
units of X and
units of Y
Transcribed Image Text:You are choosing between two goods, X and Y, and your marginal utility from each is shown in the following table. Units of X MUX Units of Y MUY 1 23 1 18 2 16 2 16 3 12 3 14 4 8 4 10 5 4 5 6 2 6 8 4 Instructions: Enter your answers as a whole number. a. If your income is $9 and the prices of X and Y are $2 and $1, respectively, what quantities of each will you purchase to maximize utility? units of X and units of Y b. What total utility will you realize? utils c. Assume that, other things remaining unchanged, the price of X falls to $1. What quantities of X and Y will you now purchase? units of X and units of Y
d. Using the two prices and quantities for X, complete the table to derive the derived demand schedule (a table showing prices and
quantities demanded) for X.
Instructions: Start with the highest price first.
Quantity
Price of X Demanded of X
$
+A
$
Transcribed Image Text:d. Using the two prices and quantities for X, complete the table to derive the derived demand schedule (a table showing prices and quantities demanded) for X. Instructions: Start with the highest price first. Quantity Price of X Demanded of X $ +A $
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