If Raul's marginal utility per dollar from bread is 25 and the marginal utility per dollar from butter is 30,
A) Raul should purchase more butter and less bread to increase his total utility.
B) Raul's marginal utility from butter will fall if he buys more butter.
C) Raul's marginal utility from bread will rise if he buys less bread.
D) Only answers B and C are correct.
E) Answers A, B, and C are correct.

Question

Quizplus · Accepted Answer

Raul should purchase more butter and less bread to increase his total utility because the marginal utility per dollar from butter is higher than the marginal utility per dollar from bread. As for answers B and C, they are also correct - Raul's marginal utility from butter will eventually fall if he buys more butter and his marginal utility from bread will rise if he buys less bread.

If Raul's Marginal Utility Per Dollar from Bread Is 25