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Suppose a Cup of Tea Costs $0

Question 75

Multiple Choice

Suppose a cup of tea costs $0.60 and a scone costs $1.20. If Edith spends all of her income on these two goods, and at her current level of consumption, she receives a marginal utility of 6 utils from the last cup of tea she buys and a marginal utility of 24 utils from the last scone she buys, then Edith should:


A) buy more tea and fewer scones.
B) buy less tea and more scones.
C) not change her consumption of tea and scones.
D) buy more tea and more scones.

Correct Answer:

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