John Smedley, a Careful Maximizer of Utility, Consumes Only Two

question 31

Multiple Choice

John Smedley, a careful maximizer of utility, consumes only two goods, peanut butter and ice cream.He had just achieved the utility-maximizing solution in his consumption of the two goods when the price of ice cream fell.As he adjusts to this event, he will consume:

• A) more peanut butter and more ice cream.
• B) less peanut butter and less ice cream.
• C) more peanut butter and less ice cream.
• D) less peanut butter and more ice cream.