Juliette and Andrew regularly go to the movies, where they like to consume popcorn and slushies. At the movies, Juliette's utility function is given by U(J)=PS, where P is the number of cups of popcorn and S is the number of slushies she consumes. Andrew's utility function is given by

U(A)=P+S.

(a) When Andrew is consuming 1 popcorn and 1 slushie, another popcorn will increase

his utility by 1 unit. (Verify this!) When Andrew is consuming 8 popcorns and 1

slushie, another popcorn will again increase his utility by 1 unit. Which assumption

of consumer preferences might Andrew's particular utility function violate?

(b) Find Andrew's marginal rate of substitution

dS/dP . (Hint: It is a constant function of P and S.)

(c) Find Juliette's marginal rate of substitution dS/dP. (Hint: It is not a constant function of P and S.)

(d) Does Juliette's utility function appear to violate that assumption, too? Why or why

not?