Sam is willing to pay $12 per month for 1 green egg per month, $10 for the 2nd,

Question

Sam is willing to pay $12 per month for 1 green egg per month, $10 for the 2nd, $8 for the 3rd, etc. The market price of green eggs is $8. He is willing to pay $20 per month for 1 slice of ham, $16 for the 2nd, $12 for the 3rd, etc. The market price for ham slices is $12.

1. Sam purchases ____ green eggs per month and ____ ham slices per month. He spends $___ on eggs and $___ on ham.

2. Which good provides Sam with the greatest net benefits?

3. If green eggs is now $6. Which good provides Sam with the greatest net benefits?

Explanation / Answer

1. Sam purchases 3 green eggs per month and 3 ham slices per month. He spends $24 on eggs and $36 on ham.

2. Ham provides Sam with the greatest net benefits.

3. If the eggs cost $6 the net benefits for Sam would be the same for both.

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