The consumer optimum (for two goods, A and B) is reached when
A) TUA = TUB.
B) MUA = MUB.
C) TUA/PA = TUB/PB.
D) MUA/PA = MUB/PB.

Name: The consumer optimum (for two goods, A and B) is reached when A) TUA = TUB. B) MUA = MUB. C) TUA/PA = TUB/PB. D) MUA/PA = MUB/PB.
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Question

Quizplus · Accepted Answer

The consumer optimum is reached where the marginal utility per dollar spent on each good is equal. This can be expressed as MUA/PA = MUB/PB. Therefore, the correct answer is D.

The Consumer Optimum (For Two Goods, a and B) Is