Use the following to answer question:
-(Table: Consumer Equilibrium)Use Table: Consumer Equilibrium.Assume that the price of good X is $2 per unit and the price of good Y is $1 per unit,that you consume three units of good X and three units of good Y,and that you are spending all of your income.To maximize utility,assuming that the goods are divisible,you would consume _____ of X and _____ of Y.
A)less;less
B)more;more
C)less;more
D)more;less

Question

Use the following to answer question: 
-(Table: Consumer Equilibrium)Use Table: Consumer Equilibrium.Assume that the price of good X is $2 per unit and the price of good Y is $1 per unit,that you consume three units of good X and three units of good Y,and that you are spending all of your income.To maximize utility,assuming that the goods are divisible,you would consume _____ of X and _____ of Y.
A)less;less 
B)more;more 
C)less;more 
D)more;less

Quizplus · Accepted Answer

To maximize utility, the marginal utility per dollar spent on each good should be equal. If the marginal utility per dollar of good X is less than that of good Y, you should consume less of X and more of Y.

Use the Following to Answer Question