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Charlotte spends her income of $2400 on clothing (good x), and the composite good (good y ). The utility Charlotte receives from consuming a basket

Charlotte spends her income of $2400 on clothing (good x), and the composite good (good y ). The utility Charlotte receives from consuming a basket of clothing and the composite good is, U(x, y ) = 2 x + y 300. The corresponding marginal utilities are, MUx = 1 x and MUy = 1 300.

QUESTION 1 ? Is the 'principal of diminishing marginal utility' satisfied for both clothing and the composite good? Briefly explain.

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