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Suppose Ana has to choose between purchasing high-definition televisions and milk. Which of the following is the utility-maximizing rule that Ana should follow while choosing
Suppose Ana has to choose between purchasing high-definition televisions and milk. Which of the following is the utility-maximizing rule that Ana should follow while choosing the optimal quantities of these two goods? (Note: In the answer options that follow, MU stands for "marginal utility.") MU of MilkPrice of Milk=MU of HDTVsPrice of HDTVs MU of Milk=MU of HDTVs MU of MilkPrice of HDTVs=MU of HDTVsPrice of Milk (MU of Milk)(Price of Milk)=(MU of HDTVs)(Price of HDTVs) Since milk costs little and high-definition televisions are expensive, it must follow that when people choose their optimal quantities of milk and high-definition televisions to purchase, the marginal utility they receive from the last high-definition television they buy is than the marginal utility they receive from the last gallon of milk they buy
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