You Have $5 to Spend on Any Combination of Goods

question 17

Essay

You have $5 to spend on any combination of goods A and
B. Are you maximizing your utility? If so, explain why. If not, what combination of goods should you buy?
B. The price of good A is $2 and the price of good B is $1. You have calculated the following utility values for yourself:
$$\begin{array} { c c c c c c c } \hline \text { Units } & \mathbf { T U } _ { \mathbf { A } } & \mathbf { M U } _ { \mathbf { A } } & \mathbf { M U } _ { \mathbf { A } } \mathbf { P } _ { \mathbf { A } } & \mathbf { T U } _ { \mathbf { B } } & \mathbf { M U } _ { \mathbf { B } } & \mathbf { M U } _ { \mathbf { B } } / \mathbf { P } _ { \mathbf { B } } \\\hline 0 & 0 & & & 0 & & \\1 & 16 & & & 30 & & \\2 & 30 & & & 50 & & \\3 & 40 & & & 58 & & \\4 & 46 & & & 64 & & \\\hline\end{array}$$ (a) Fill in the empty columns of the table.
(b) You have purchased 2 units of good A and 1 unit of good

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Definitions:

Self-employed Farmers

Individuals who operate their own agricultural enterprises, producing crops or raising livestock, without being employed by another entity.

Blacksmiths

Artisans who work with metal, particularly iron, using tools to forge and shape it into products such as tools, weapons, and structures.

AFL

The American Federation of Labor, a national federation of labor unions in the United States, founded in 1886 and focused on skilled workers.

Knights of Labor

A significant labor organization in the United States during the 19th century that sought to organize workers across different industries to improve working conditions.