Suppose you spent your entire budget on goods so that the marginal utility per dollar spent on each is identical. Which of the following is true?
A) Your purchases are not efficient because there is no reason why you should buy the
Same quantity of each.
B) You can increase your total utility by shifting income from low marginal utility
Generating goods to higher marginal utility generating ones.
C) You will reduce your total utility if you allocate income in any other way.
D) You are minimizing your marginal utility this way, which is what you want.
E) You can avoid diminishing marginal utility.
Correct Answer:
Verified
Q119: The law of diminishing marginal utility explains
Q120: "The second glass of zinfandel was very
Q121: As more bananas are consumed, marginal utility
Q122: Have you ever gone to an auction?
Q123: Lorna loves sweaters! She has drawers filled
Q125: Helen is a computer analyst earning $750,000
Q126: Maria goes shopping for wedding shoes and
Q127: Which of the following is likely to
Q128: Suppose your best friend's birthday is next
Q129: How do you calculate the total consumer
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents