-The table above gives Ali's total utility from consuming bottles of soft drink and slices of pizza. The price of pizza is $2 per slice and the price of soft drink is $1 per bottle. Ali has $14 in his budget. When Ali maximises his utility he buys ________ bottles of soft drink and ________ slices of pizza.
A) 6; 4
B) 4; 5
C) 6; 6
D) 2; 6
E) None of the above answers is correct.

Question

-The table above gives Ali's total utility from consuming bottles of soft drink and slices of pizza. The price of pizza is $2 per slice and the price of soft drink is $1 per bottle. Ali has $14 in his budget. When Ali maximises his utility he buys ________ bottles of soft drink and ________ slices of pizza.
A) 6; 4 
B) 4; 5 
C) 6; 6 
D) 2; 6 
E) None of the above answers is correct.

Quizplus · Accepted Answer

To maximize utility, Ali should allocate his budget such that the marginal utility per dollar spent on each good is equal. Given the budget constraint of $14, Ali can buy 4 bottles of soft drink ($4) and 5 slices of pizza ($10), maximizing his utility within the budget.

-The Table Above Gives Ali's Total Utility from Consuming Bottles