Refer to the information provided in Table 6.3 below to answer the question(s) that follow.
Table 6.3
$$\begin{array} { | c | c | c | }
\hline \begin{array} { c }
\text { Dozens of Oysters } \
\text { per Day }
\end{array} & \text { Total Utility } & \text { Marginal Utility } \
\hline 1 & 60 & \
\hline 2 & 104 & \
\hline 3 & 134 & \
\hline 4 & 152 & 8 \
\hline 5 & & \
\hline \begin{array} { c }
\text { Number of } \
\text { Beersper Day }
\end{array} & \text { Total Utility } & \text { Marginal Utility } \
\hline 1 & 40 & \
\hline 2 & 70 & \
\hline 3 & 94 & \
\hline 4 & 114 & \
\hline 5 & & 14 \
\hline
\end{array}$$
-Refer to Table 6.3. If the price of a beer is $4, the price of a dozen oysters is $12, and Tyler has $28 of income, Tyler's utility-maximizing combination of beers and oysters per day is
A) 1 beer and 2 dozen oysters.
B) 4 beers and 1 dozen oysters.
C) 3 beers and 1.5 dozen oysters.
D) indeterminate from this information.

Question

Refer to the information provided in Table 6.3 below to answer the question(s) that follow.
Table 6.3
 $$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Dozens of Oysters } \
\text { per Day }
\end{array} & \text { Total Utility } & \text { Marginal Utility } \
\hline 1 & 60 & \
\hline 2 & 104 & \
\hline 3 & 134 & \
\hline 4 & 152 & 8 \
\hline 5 & & \
\hline \begin{array} { c } 
\text { Number of } \
\text { Beersper Day }
\end{array} & \text { Total Utility } & \text { Marginal Utility } \
\hline 1 & 40 & \
\hline 2 & 70 & \
\hline 3 & 94 & \
\hline 4 & 114 & \
\hline 5 & & 14 \
\hline
\end{array}$$
-Refer to Table 6.3. If the price of a beer is $4, the price of a dozen oysters is $12, and Tyler has $28 of income, Tyler's utility-maximizing combination of beers and oysters per day is
A) 1 beer and 2 dozen oysters.
B) 4 beers and 1 dozen oysters.
C) 3 beers and 1.5 dozen oysters.
D) indeterminate from this information.

Quizplus · Accepted Answer

To maximize utility, Tyler should equalize the marginal utility per dollar spent on each good. The marginal utility per dollar for the 4th beer is 14/4 = 3.5, and for the 1st dozen oysters, it is 60/12 = 5. Tyler can afford 4 beers ($16) and 1 dozen oysters ($12) with his $28, maximizing his utility.

Refer to the Information Provided in Table 6 -Refer to Table 6