The Following Graph Shows the Marginal Utility Derived from Milk

question 129

Multiple Choice

The following graph shows the marginal utility derived from milk and giant cookies purchased by Sandeep.

-Refer to the above graph to answer this question.If the price of both milk and cookies are $1 and Sandeep has a budget of $7,how many will he purchase if he wishes to maximize his total utility?

• A)2 milk and 5 cookies.
• B)3 milk and 4 cookies.
• C)4 milk and 3 cookies.
• D)5 milk and 2 cookies.
• E)6 milk and 1 cookie.

---

Definitions:

Deontological Theory

A moral philosophy where the morality of an action is based on its adherence to rules or duties, rather than the consequences of the action.

Utilitarian Theory

A normative ethical theory that suggests that the best action is the one that maximizes utility, often defined as maximizing happiness and reducing suffering.

Deontological Theory

An ethical framework that judges the morality of an action based on its adherence to a set of rules, rather than the consequences of the action.

Profit Maximization Theory

An economic principle suggesting that the goal of a business is to increase net income by managing revenue and costs.