If, after a person buys a set of goods with his/her income and total utility is not maximized, then
A) some change in the composition of the goods bought will increase utility
B) we know that the prices were not equal
C) we know that the MU/P for all goods had to be equal
D) we know that marginal utility of the last good purchased was higher than the total utility of the set of goods bought
E) the law of diminishing marginal utility does not apply in this case

Question

Quizplus · Accepted Answer

If total utility is not maximized after a purchase, it implies that the allocation of income across different goods is not optimal. Adjusting the composition of goods bought (buying more of some goods and less of others) could lead to an increase in total utility, indicating that the initial allocation was not utility-maximizing.

If, After a Person Buys a Set of Goods with His/her