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1. (4 pts.) Juan is a high school student who is working only four hours per week at a local retail establishment. Juan has $

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1. (4 pts.) Juan is a high school student who is working only four hours per week at a local retail establishment. Juan has $ 34 per week of disposal income. With his $ 34, Juan buys only three goods ( J, K, and L ). The price of good J is $ 1 per unit, the price of good K is $ 3 per unit, and the price of good L is $ 2 per unit. The table below presents Juan's utility function for the three goods. Total utility is in the columns labeled "TU." Good J Good K Good L Units MUJ MUK MUL of TU, MU, PJ TUK MU X PK TUL MUL PL Product 0 0 0 0 7 27 18 13 51 34 18 72 48 4 22 90 60 U 25 105 70 6 27 117 78 28 126 84 8 28 132 88 9 27 135 90 a. In the above table, fill in the columns showing Marginal Utility (MU) and Marginal Utility per dollar ("bang per buck" ratios) for all three goods. b. As Juan consumes more and more units of a good, the marginal utility of each additional unit (increases / decreases / remains unchanged ), and this reflect the "law of c. Given $34 of disposable income, Juan will purchase _units of good J, units of good K, and units of good L in order to maximize his total utility. d. At Juan's utility-maximizing choice from part c. above, his Total Utility from the consumption of the three goods is utils. e. If Juan gets a raise and his disposable income increases to $46 per week, Juan's utility-maximizing combination will be _units of good J, _units of good K and units of good L. (NEXT PAGE)

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