Table 7-3 -Refer to Table 7-3

question 341

Multiple Choice

Table 7-3
$$\begin{array} { | c | c | c | } \hline & \text { Ice Cream Cones } & \text { Lime Fizz Soda } \\\hline \text { Quantity } & \boldsymbol { M U } & \boldsymbol { M U } \\\hline 1 & 30 & 40 \\\hline 2 & 25 & 35 \\\hline 3 & 20 & 26 \\\hline 4 & 15 & 18 \\\hline 5 & 10 & 15 \\\hline 6 & 5 & 7 \\\hline\end{array}$$
-Refer to Table 7-3.The table above shows Lee's marginal utility per dollar from consuming ice cream cones and cans of Lime Fizz Soda.The price of an ice cream cone is $2 and the price of Lime Fizz Soda is $1.Use this information to select the correct statement.

• A)We cannot determine how many ice cream cones and cans of Lime Fizz Soda Lee will consume without knowing what his income is.
• B)To maximize his utility Lee should consume 1 ice cream cone and 5 cans of Lime Fizz Soda.
• C)We cannot determine how many ice cream cones and cans of Lime Fizz Soda will maximize Lee's utility because we are given only the marginal utility per dollar values.We also need to know the marginal utility for each quantity.
• D)If Lee has an unlimited budget he will maximize his utility by buying only Lime Fizz Soda.

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Definitions:

Detached

Referring to a state of emotional disengagement or separation from surroundings or feelings.

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The activation of the autonomic nervous system, which regulates involuntary physiological functions such as heart rate, digestion, and respiratory rate, usually associated with emotional and stress responses.

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A psychiatric condition characterized by the presence of two or more distinct personality states or identities within a single individual.