If the Ratio of the Marginal Utility of Bread to the Marginal

question 172

Multiple Choice

If the ratio of the marginal utility of bread to the marginal utility of butter is 2,Brad can increase his welfare by consuming

• A) more bread.
• B) more bread and butter.
• C) more butter only.
• D) less bread.
• E) more bread only if the price of bread is less than twice the price of butter.

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Definitions:

Derived Demand

A situation where the demand for one product or service occurs as a result of the demand for another product or service.

Resellers

Businesses or individuals that buy products or services with the intention of selling them rather than consuming or using them.

Institutional Buyers

Organizations that purchase goods and services in large volumes for operational purposes, not for individual consumption.

Purchasing Agents

Individuals or companies responsible for acquiring goods or services for their own use or for resale.