Casey consumes two goods, hamburgers and ice cream sandwiches. e has maximized his utility given his income. Ice cream sandwiches costs $2, and he consumes them to the point where the marginal utility he receives is 6. Hamburgers cost $4, and the relationship between the marginal utility that Casey gets from eating hamburgers and the number he Hamburgers Marginal Utility I 20-6 How many hamburgers does Casey buy each month? a. b. 2 c. 3 d. 4

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30-11-2022
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Casey consumes two goods, hamburgers and ice cream sandwiches. e has maximized his utility given his income. Ice cream sandwiches costs $2, and he consumes them to the point where the marginal utility he receives is 6. Hamburgers cost $4, and the relationship between the marginal utility that Casey gets from eating hamburgers and the number he Hamburgers Marginal Utility I 20-6 How many hamburgers does Casey buy each month? a. b. 2 c. 3 d. 4

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The correct option is C. we can say that Casy must buy 3 hamburgers each month in order to be in consumers' equilibrium.

In the two good cases, the consumer equilibrium condition is as follows:

{Margianl Utility from good 'x' / Price of good 'x'} = {Marginal Utility from good 'y' / Price of good 'x'}

MUx / Px = MUy / Py

So, in this case,

MU from Ice cream sandwiches / Price of Ice cream sandwiches = MU from Hamburgers / Price of hamburgers

6/2 = MU from Hamburgers / 4

Solving the above, we get,

MU from hamburgers = 12

Looking at the table, we can say that Casy must buy 3 hamburgers each month in order to be in consumers' equilibrium.

consumer equilibrium means a kingdom of most satisfaction. A situation wherein a customer spends his given income purchasing one or greater commodities so that he gets most pleasure and has no urge to change this degree of intake, given the costs of commodities, is called the patron's equilibrium.

at the time of purchasing a unit of a commodity, a patron compares the price of the given commodity with its utility. The patron will be at equilibrium whilst marginal utility (in phrases of money) equals the charge paid for the commodity say 'X' i.e. MUx = PX.

consistent with Marshallian utility analysis, when the expenditure of a consumer has been completely adjusted, that is, whilst marginal software in every course of his purchases is equal, it is known as the client's equilibrium. Then he has no choice but to shop for any extra of one commodity and much less of another

To learn more about consumers equilibrium visit here:

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