z is the marginal utility per dollar measured in utils, x is the amount spent on product A, and y is the amount spent on product B.Assume MUA = z = 20 – x and MUB = z = 42 – 4y.Assume that the consumer has $20 to spend on A and B; that is, x + y = 20.What is the marginal utility per dollar? What is best way to allocate the expenditure of the $20?
Solution ID:10036866 | Question answered on 16-Oct-2016
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