Suppose a consumer spends all his income. His marginal utility per dollar on X is 4 and marginal utility per dollar on Y is 2. We know that

Question

Suppose a consumer spends all his income. His marginal utility per dollar on  X  is 4 and marginal utility per dollar on  Y  is 2. We know that

Answer

the price of  Y  must be one-third the price of  X .

Answer

utility is maximized.

Answer

utility can be increased by decreasing the consumption of  X  and increasing the consumption of  Y .

Answer

utility can be increased by increasing the consumption of  X  and decreasing the consumption of  Y .

Answer

the price of  Y  must be eight times the price of  X .

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