Question
QUESTION 04 &nb
QUESTION 04 3 marks
Jake has budget of $10 per week to spend on study and games. The table shows his marginal utility from each good/services.
|
Quantity Per Week |
Marginal Utility from Study |
Marginal Utility from Games |
|
1 |
14 |
20 |
|
2 |
12 |
16 |
|
3 |
11 |
12 |
|
4 |
10 |
8 |
|
5 |
9 |
4 |
|
6 |
8 |
3 |
|
7 |
7 |
2 |
|
8 |
6 |
1 |
a. Calculate his total utility from study and games with the help of their marginal utilities.
b. Prove with the help of graph that their marginal utilities have diminishing marginal utilities.
c. If the price of a studying per course is $1 and the price of per game is $2, what are his affortable combinations of commodities.
Homework Answers
Answer #1
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