Refer to the Above Diagrams That Show Identical Marginal Utility

question 38

Multiple Choice

Refer to the above diagrams that show identical marginal utility from income curves for Singer and Catalano.If a given income of $20,000 is initially distributed so that Singer receives $15,000 and Catalano $5000:

• A) no judgment can be made as to the effect of a redistribution of income on total utility.
• B) this initial distribution of income is maximizing the combined total utility of the two consumers.
• C) the combined total utility of the two consumers can be increased by redistributing income from Catalano to Singer.
• D) the combined total utility of the two consumers can be increased by redistributing income from Singer to Catalano.

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