You have decided to spend $40 this month on CDs and movies. The total benefits you receive from different quantities of CDs and movies are shown in the table below.

The price of a CD is $10 and the price of a movie is $10.

a. Complete columns B, C, E, and F in the table above.

b. What combination of movies optimizes your total benefit? Explain your reasoning.

c. Suppose the local movie theater decides to offer a student discount and as a result the price of a movie falls to $5. If the price of CDs remains $10 and you continue to spend $40 on CDs and movies, now what combination of movies optimizes your total benefit?
Explain your reasoning.

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CDs Marginal Movies Marginal x Total Marginal Benefit Total Marginal Benefit Benefit Benefit per Dollar Benefit Benefit per Dollar Quantity (A) (B) (F) (C) (D) (E) 0 0 X X 0 x 1 200 140 2 360 260 3 500 360 4 620 440