Suppose that the price of fruity pebbles cereal is $2 per box and the price of o

Question

Suppose that the price of fruity pebbles cereal is $2 per box and the price of of bing cherries is $6 per pound. if you get 30 utils from the last pound of bing cherries you consume, how many utils would you have to get from the last box of fruity pebbles cereal to be in consumer equilibrium? 9 See Hint Suppose that the price of Fruity Pebbles cereal is $2 per box, and the price of bing cherries is $6 per pound. If you get 30 utils from the last pound of bing cherries you consume, how many utils would you have to get from the last box of Fruity Pebbles cereal to be in consumer equilibrium? utils

Explanation / Answer

At competitive equilibrium, marginal cost = marginal utility

Marginal cost of Bing cherries is the price of cherries that is 6.

Marginal utility = changes in total utility.

Let total utility from last unit consumer be x

=> 6 = x - 30

x= 36

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