The Utility-Maximization Condition for Two Goods Is Achieved by Equating

question 218

Multiple Choice

The utility-maximization condition for two goods is achieved by equating the:

• A) prices of both goods.
• B) marginal utilities of both goods.
• C) ratios of total utility to price of both goods.
• D) ratios of marginal utility to price of both goods.

---

Definitions:

Budgeted Sales

An estimate of the sales revenue a company expects to achieve for a certain period, often used for planning and control purposes.

Beginning Inventory

The value of all the inventory that a company has at the start of an accounting period, before any purchases or sales have been made.

Ending Inventory

The total value of all inventory that a business has in stock at the end of an accounting period.

Direct Materials

Raw materials that can be directly attributed to the production of a specific product.