The Below Table Shows the Average Utility (In Utils) Obtained

question 46

Multiple Choice

The below table shows the average utility (in utils) obtained from the consumption of goods A and B.Table 7.3

-Assume MU_X = 30 utils, MU_Y = 15 utils, P_X = $2, and P_Y = $0.50. This consumer:

• A)should buy less of X and less of Y.
• B)is in equilibrium.
• C)should buy more of X and less of Y.
• D)should buy less of X and more of Y.
• E)should buy more of X and more of Y.

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Definitions:

Equilibrium Price

The cost at which the amount of a product sought by consumers matches the amount available from suppliers, leading to equilibrium in the market.

Demand Curve

A graph showing the relationship between the price of a good and the quantity of that good consumers are willing and able to purchase, typically depicting a downward slope.

Competitive Market

A market structure characterized by numerous buyers and sellers, ensuring no single participant has the power to significantly influence prices.

Average Total Cost

The per unit cost of production, calculated by dividing the total cost of production by the quantity of output produced.