Stats Solutions

(See Solution) Columns 1 through 4 in the table below show the marginal utility, measured in utils, that Ricardo would get by purchasing various amounts

Question: Columns 1 through 4 in the table below show the marginal utility, measured in utils, that Ricardo would get by purchasing various amounts of products A, B, C, and D. Column 5 shows the marginal utility Ricardo gets from saving. Assume that the prices of A, B, C, and D are $18, $6, $4, and $24, respectively, and that Ricardo has an income of $106.

Column 1 Column 2 Column 3 Column 4 Column 5
Units
of A 		MU Units
of B 		MU Units
of C 		MU Units
of D 		MU No. of
$ saved 		MU
1
2
3
4
5
6
7
8 		72
54
45
36
27
18
15
12 		1
2
3
4
5
6
7
8 		24
15
12
9
7
5
2
1 		1
2
3
4
5
6
7
8 		15
12
8
7
5
4
3.5
3 		1
2
3
4
5
6
7
8 		36
30
24
18
13
7
4
2 		1
2
3
4
5
6
7
8 		5
4
3
2
1
1/2
1/4
1/8
  1. What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility?
  2. How many dollars will Ricardo choose to save?
  3. Check your answers by substituting them into the algebraic statement of the utility maximizing rule.

Price: $2.99
Solution: The downloadable solution consists of 2 pages
Deliverable: Word Document


∴ Other downloads you may be interested in ∴

log in to your account

Forgot password?
Don't have a membership account?
REGISTER

reset password

Back to
log in

sign up

Back to
log in