John Doe has $100 to spend on Wild Smoked Salmon ($25 per unit) and mon and 1 Hi

Question

John Doe has $100 to spend on Wild Smoked Salmon ($25 per unit) and mon and 1 Hickory Turkey (B) 2 Hickory Turkey and 1 smoked salmon (C)2 o question 10, when will John maximize his marginal utility per dollar? 10. S Hi surkey (S50 per unit). To maximize utility, John must buy: (A) 1 salmon and 1 smoked turkey (D) Only 2 smoked turkey ckory Smoked smoked (A) When m dmes the price of turkey, but twice the price of salmon (C) When the revenue of a firm total revenue is $500, implicit cost is $100 and ase total cost is rising (ATC): (A) The marginal cost must be rising below the ATC of trkeyrginal utility is twice the price of both goods (B) When the marginal utility (D) Wh salmon is three times the price of salmon but twice the price of turkey 12. S en John can no longer consume more salmon uppose the total (C) $200 (D) $100 $200. The economic profit of the firm must be: (A) $400 (B) $300 falling (D) The fim mut be rising above the ATC (C) The average variable cost must be u s0a rgna os of producing the very first unit of a good is $70, variable cost must be 14. If the 15, If the ATC of producing 3 units of a good is s60, total cost must be: (A) $20 (B) $15 (C) $180 16. If (A) $90 (B) $80 (C) $70 (D) $60 (D) None of the above Production (B) Reduce production (C) Decrease the nrice (D) Cut taxes marginal cost is greater than the price of a good, the perfect competitor must: (A) Increase

Explanation / Answer

10. Option C

Explanation: In option A, John will still have $25 i.e. there is still a scope to increase utility. So, option A is invalid.

John cannot afford to buy option B as it will require $125. So, option B is invalid.

Both option C and D are exactly within Budget. However, Option C provides more utility as it increases consumption. So, option C maximizes utility.

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