If a consumer's marginal utility was 10 utils per unit of meat and 5 utils per unit of potatoes:
A)the consumer should purchase less potatoes and more meat to maximize his satisfaction.
B)the consumer would be in equilibrium if the per-unit price of meat was twice the price of potatoes.
C)the consumer would be in equilibrium if the price per unit of meat was half the price of potatoes.
D)the consumer's total utility could be increased by consuming more potatoes and less meat until the marginal utilities of the two goods were equal.

Question

Quizplus · Accepted Answer

The consumer is in equilibrium when the ratio of marginal utility to price is equal for all goods. If the marginal utility of meat is twice that of potatoes, the price of meat should be twice that of potatoes for equilibrium.

If a Consumer's Marginal Utility Was 10 Utils Per Unit