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Assume That Diminishing Marginal Utility Applies to Both Textbooks and Concert

Question 98

Multiple Choice

Assume that diminishing marginal utility applies to both textbooks and concert tickets and that James is spending all of his income.If James purchases a combination of textbooks and concert tickets such that MUTextbooks/PTextbooks = 100 and MUTickets/PTickets = 80,to maximize utility,James should buy _____ textbooks and _____ tickets.


A) fewer;fewer
B) more;fewer
C) fewer;more
D) more;more

Correct Answer:

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