Pam Buys Only Thread and Fabric, and She Buys the Quantities

question 362

Multiple Choice

Pam buys only thread and fabric, and she buys the quantities that maximize her utility. Her marginal utility from a spool of thread is 30 units and her marginal utility from a yard of fabric is 60 units. If the price of a spool of thread is $4, then you are sure that the price of a yard of fabric is

• A) $4.
• B) $2.
• C) $8.
• D) $12.