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Goshia [24]
3 years ago
12

Let MUS be the marginal utility of a sandwich, MUH be the marginal utility of a hot dog, PS be the price of a sandwich, and PH b

e the price of a hot dog. When the price of the goods is zero, Pat eats a sandwich. When Pat has to pay, she eats a hot dog. When Pat has to pay, which of the following is necessarily true?
(A) MUS = MUH = PS = PH
(B) (MUS / PS) > (MUH / PH)
(C) PS < PH
(D) PS > PH
(E) MUS = 0
Business
1 answer:
12345 [234]3 years ago
7 0

Answer:

D) PS > PH

Explanation:

When Pat doesn't have to pay, she will choose to eat a sandwich, therefore the MUS > MUH.

But when she has to pay, then she will choose to eat a hot dog, therefore the utils per dollar that Pat gets from a hot dog are more than the utils per dollar that she gets from a sandwich: (MUS / PS) < (MUH / PH)

The only explanation to this is that the price of sandwich is higher than the price of a hot dog: PS > PH

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$978,306

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6 0
3 years ago
You have just received an offer in the mail from Friendly Loans. The company is offering to loan you $4,250 with low monthly pay
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8 0
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8 0
3 years ago
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