Business, 31.12.2020 19:10 whattag

Ken consumes two goods, Sprite and potato chips. Sprite costs $1 per can, and he consumes it to the point where the marginal utility he receives from his last Sprite is 3. Potato chips cost $2 per bag, and the relationship between the marginal utility he gets from eating a bag of potato chips and the number of bags he eats per month is as follows: Bags of Potato chips 1 2 3 4 5 6
Marginal utility 30 20 12 6 2 0

Required:
If Ken is maximizing his utility, how much does he spend on potato chips each month?

a. $2
b. $6
c. $8
d. $10
e. $12

Answers: 3

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Ken consumes two goods, Sprite and potato chips. Sprite costs $1 per can, and he consumes it to the...

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