The Relative Price of Beer to Bacon Is 2:1

question 46

Multiple Choice

The relative price of beer to bacon is 2:1.If Bob's current consumption is at a level where MU_beer/MU_bacon is 1:2,then to maximize total utility Bob must

• A)consume more beer and less bacon.
• B)not change his current consumption of beer and bacon.
• C)consume less beer and more bacon.
• D)raise the price of beer.
• E)consume twice as much beer and half as much bacon.

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Definitions:

Total Needs

The comprehensive requirements or demands of a process, project, or organization.

Units Produced

The total number of completed units generated by a manufacturing or production process in a given period.

July

The seventh month of the Gregorian calendar year.

Budgeted Purchases

The estimated amount of goods or materials a company plans to buy over a certain period, often part of the budgeting process.