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John Is Maximizing Utility When Consuming Two Goods: French Fries

question 120

True/False

John is maximizing utility when consuming two goods: French fries and hot dogs. If the marginal utility from the last box of fries John consumed is 60 and the marginal utility of the last hot dog John consumed is 120 and hot dogs cost $1.00 apiece, a box of fries must cost $0.50.


Definitions:

Cost Variance

The difference between the actual cost incurred for a particular activity or production and its standard or budgeted cost.

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