Scenario 4.1: Daniel Derives Utility from Only Two Goods, Cake (Qc) and (Qc)

question 41

Multiple Choice

Scenario 4.1:
Daniel derives utility from only two goods, cake (Qc) and donuts (Qd) . The marginal utility that Daniel receives from cake (MUc) and donuts (MUd) are given as follows:
MUc = Qd MUd = Qc
Daniel has an income of $240 and the price of cake (Pc) and donuts (Pd) are both $3.
-See Scenario 4.1. What quantity Qc will maximize Daniel's utility given the information above?

• A) 0
• B) 24
• C) 40
• D) 60
• E) none of the above

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