Question

Amy purchased four cantaloupes at $2 each and three watermelons at $4 each. If Amy is following the optimal consumption rule, the marginal utility of the fourth cantaloupe and third watermelon are: Select one: a. 4 and 3, respectively. b. 40 and 10, respectively. c. 12 and 24, respectively. d. 6 and 8, respectively.

Answer 1

C) 12 and 24, respectively.

Step-by-step explanation:

The optimal consumption rule states that to maximize utility, a customer's marginal utility per dollar spent should be equal for all goods purchased.

In this case since watermelons' price is twice the cantaloupes' price, then their marginal utility should be double also.