The Ratio of the Marginal Utility of Coffee to the Marginal

question 120

Multiple Choice

The ratio of the marginal utility of coffee to the marginal utility of donuts is four for an individual maximizing utility. This implies that

• A) a donut is four times more valuable than a cup of coffee.
• B) the coffee to donuts price ratio is one to four.
• C) the coffee to donuts price ratio is four to one.
• D) this person always eats donuts with coffee.

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