Final answer:
Kate is maximizing her utility by allocating her time to her consulting job, which is more economically beneficial than growing vegetables. Alphonso's purchasing decisions, similarly, reflect a maximization of utility based on marginal utility and opportunity cost.
Step-by-step explanation:
Considering the information provided, Kate is currently maximizing her utility by specializing in her consulting job, which she is very productive at, rather than growing vegetables, where she is not very productive. Specialization of labor allows her to maximize her income, as the opportunity cost of time spent on less productive tasks is greater than the benefits derived from them. Similarly, in the case of Alphonso, a rational consumer only purchases additional units of a product as long as the marginal utility exceeds the opportunity cost. As soon as the opportunity cost, such as the marginal utility he gives up by not having burgers, is greater than the marginal utility of more bus tickets, he will cease purchasing more. This example illustrates how individual spending behavior reflects the pursuit of maximizing utility within the constraints of a budget.