Mr.Fefferberg had determined that the marginal utility of the last dollar he spent on cowboy boots is greater than the marginal utility of the last dollar that he spent on Nikes.Since he is a rational fellow,he will
A)buy equal quantities of Nikes and cowboy boots.
B)buy more cowboy boots and fewer Nikes.
C)buy more Nikes and fewer cowboy boots.
D)give up cowboy boots entirely.
E)give up Nikes entirely.

Question

Quizplus · Accepted Answer

Mr. Fefferberg should buy more cowboy boots and fewer Nikes because the marginal utility of the last dollar spent on cowboy boots is higher than that of Nikes. This means that he will derive more satisfaction from purchasing another cowboy boot than he would from another Nike. Buying more cowboy boots and fewer Nikes would allow him to maximize his overall satisfaction or utility.

MrFefferberg Had Determined That the Marginal Utility of the Last