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Jason is trying to decide weather to buy a bagel or a muffin for breakfast. The bagel cost 50 cents and has a marginal utility of5. The muffin costs 2.5 and has a marginal utility of 20. Which should...

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Jason is trying to decide weather to buy a bagel or a muffin for breakfast. The bagel cost 50 cents and has a marginal utility of5. The muffin costs 2.5 and has a marginal utility of 20. Which should he buy , and why ? show all calculations.
A. The muffin, because it has a high marginal utility.B. The muffin, because it has a lower marginal utility per dollar.C. The bagel, because it costs less.D. The bagel, because it has a higher marginal utility per dollar.E. The muffin, because it has a higher marginal utility per dollar.
Answered Same Day Dec 25, 2021

Solution

David answered on Dec 25 2021
107 Votes
Jason is trying to decide weather to buy a bagel or a muffin for
eakfast. The bagel cost 50
cents and has a marginal utility of 5. The muffin costs 2.5 and has a marginal utility of 20.
Which should he buy , and why ? show all calculations.
Answer –
The formula for utility maximization...
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