A consumer maximizes his utility by purchasing 2 units of good X at $5 per unit and 3 units of good Y at $7 per unit.What is the ratio of the marginal utility from X to the marginal utility from Y?
A)5/7
B)7/5
C)2/3
D)3/2
E)10/21

Question

Quizplus · Accepted Answer

The consumer maximizes utility where the ratio of the marginal utilities equals the ratio of the prices of the two goods. Thus, MUx/MUy = Px/Py = 5/7.

A Consumer Maximizes His Utility by Purchasing 2 Units of Good