The following table describes Ben’s preferences over cake and ice cream. The uti
ID: 460491 • Letter: T
Question
The following table describes Ben’s preferences over cake and ice cream. The utility from consumption of one good is independent of the consumption of the other. The price of cake is $10 per unit, and the price of ice cream is $4 per unit.
Units
MU
MU
Consumed
Cake
Ice Cream
1
80
20
2
60
19
3
40
18
4
20
17
5
0
16
Ben’s total utility at his optimal consumption bundle will be:
a.
56.
b.
200.
c.
270.
d.
310.
e.
none of the above.
Units
MU
MU
Consumed
Cake
Ice Cream
1
80
20
2
60
19
3
40
18
4
20
17
5
0
16
Explanation / Answer
here we do not have his available amount for consumption.
without knowing the amount which he has, we can not say at what point his total utility is maximized.
so option E is right.
if you have the money he hold, please let me know
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