If it costs $12.00 to go to the movies and $30.00 to go to a hockey game, Tom is maximizing his utility between movies and hockey if his marginal utility of movies is 12 units and his marginal utility from hockey is 25.

Question

Quizplus · Accepted Answer

Tom is not maximizing his utility because the marginal utility per dollar spent on movies (1 unit per dollar) is higher than that for hockey (0.833 units per dollar), indicating he should spend more on movies to maximize utility.

If It Costs $12