Table 6.3 -Refer to Table 6.3.The Table Above Shows Lee's Marginal Utility

question 104

Multiple Choice

Table 6.3
-Refer to Table 6.3.The table above shows Lee's marginal utility per dollar from consuming ice cream cones and cans of Lemonade.The price of an ice cream cone is $2 and the price of Lemonade is $1.Use this information to select the correct statement.

• A)We cannot determine how many ice cream cones and cans of Lemonade Lee will consume without knowing what his income is.
• B)To maximise his utility, Lee should consume 1 ice cream cone and 5 cans of Lemonade.
• C)We cannot determine how many ice cream cones and cans of Lemonade will maximise 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 maximise his utility by buying only Lemonade.

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Definitions:

Business-to-Business

Commercial transactions or relationships between two businesses, rather than between a company and individual consumers.

Marketing

Marketing encompasses the activities, strategies, and processes used to promote and sell products or services, including market research, advertising, distribution, and customer relationship management, aiming to satisfy customer needs and achieve business objectives.

Business-to-Government

Transactions conducted between companies and governmental bodies.

Consumer-to-Consumer

A type of commerce where private individuals trade goods, services, or information directly with each other, often facilitated by a third-party platform.