Question
Suppose that Ben O'Dril has allocated his entire budget to the purchase of cough syrup and Kleenex tissues. The Marginal Utility of the last bottle
Suppose that Ben O'Dril has allocated his entire budget to the purchase of cough syrup and Kleenex tissues. The Marginal Utility of the last bottle of cough syrup purchased is 280 utils and each bottle of cough syrup costs $7. The Marginal Utility of the last box of Kleenex purchased is 90 utils and each box of Kleenex costs $2.Is this the utility-maximizing combination for Mr. O'Drill?
A. Yes. Ben should not change his consumption choice, as he is already maximizing his total utility.
B. No. Ben would be made happier if he purchased more boxes of Kleenex and fewer bottles of cough syrup because Kleenex is cheaper than bottles of cough syrup.
C. No. Ben would be made happier if he purchased more boxes of Kleenex and fewer bottles of cough syrup because he gets more marginal utility per dollar ("bang per buck") from the Kleenex.
D. No. Ben would be made happier if he purchased more bottles of cough syrup and fewer boxes of Kleenex because he likes bottles of cough syrup more than Kleenex tissues.
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