Basil Is Maximizing His Utility from Consuming Tea and Crumpets

question 142

Multiple Choice

Basil is maximizing his utility from consuming tea and crumpets.If the marginal utility of the last crumpet was 32 units of utility and the prices of tea and crumpets are $4 and $8, respectively, what was the marginal utility of the last cup of tea Basil consumed?

• A)2 units of utility
• B)12 units of utility
• C)$6
• D)128 units of utility
• E)16 units of utility

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Definitions:

Off Exchange

Trading that occurs outside of formal exchanges, often through over-the-counter (OTC) markets, facilitating securities transactions in a less regulated environment.

Trading

The action or activity of buying and selling goods and services or financial instruments, often in financial markets.

Lenders

Individuals, institutions, or entities that provide funds to others with the expectation that the funds will be repaid, typically with interest.

Risk-Free Rate

The return on an investment with no risk of financial loss, often represented by the yield on government securities.