Q3/ (Total marks: 25 marks) Consider the following data showing Bob's total utility(U) from the consumption of two goods: Boston Cup races and Broadway musicals. Assume the price of races is $50, the price of Broadway musicals is $100 and Bob has $300 to spend on the two goods. Number of races Number of Musicals 2 3 Total Utility 1000 1800 2500 3000 3200 2 3 4 5 Total Utility 1000 1800 2500 3000 3200 (a) Calculate the Marginal Utility(MU) and MU per dollar of both goods. (b) Assume that he wishes to maximize his utility, what combination of Boston Cup Races and Broadway musicals will Bob purchase? Justify your answer. (c) If the price of musicals doubles, what will happen to Bob's consumption of the two goods? Explain your answer. Q4/ (Total marks: 20 marks) State whether each of the following statements are true or false. Briefly explain your answers with relevant diagram(s). (i) A firm that has negative accounting profit does not necessarily have positive economic profit. (ii) Total fixed cost is increasing at every level of output. When a competitive firm produces positive output, average average cost first starts to fall and eventually rise in the short run