ERM 501 - Quantity Utility from classical CDs Utility

Question # 00614435 Posted By: dr.tony Updated on: 11/07/2017 11:53 AM Due on: 11/07/2017
Subject Economics Topic Macroeconomics Tutorials:
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Mary enjoys classical CDs and travel books and spends a75 a month on them. The following table shows the utility she gets from each good:

Quantity Utility from classical CDs Utility from travel books

1 90 120

2 110 136

3 126 148

4 138 152

5 146 154

aDraw graphs showing Mary's utility from classical CDs and from travel books.

bCompare the two utility graphs. Can you say anything about Mary's preferences?

cDraw graphs that show Mary's marginal utility from classical CDs and from travel books.

dWhat do the two marginal utility graphs tell you about Mary's preferences?

eIf a classical CD and a travel book cost a15 each, how does Mary spend the a75 a month?

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  1. Tutorial # 00613004 Posted By: dr.tony Posted on: 11/07/2017 11:53 AM
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