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Dovator [93]
4 years ago
5

Suppose Barry is maximizing his utility from consuming used paperback novels and audio books. The price of a used novel​ = $4 an

d the price of an audio book​ = $8. If the marginal utility of the last novel was 32 units of utility​ (utils) what was the marginal utility of the last audio book​ purchased? A. 2 utils B. 12 utils C. 16 utils
Business
1 answer:
In-s [12.5K]4 years ago
8 0

Answer:

None of the answers is correct, it should be 64 utils

Explanation:

If Barry's utility from consuming a used novel is 32 utils and the book costs $4, he was able to get 8 utils per dollar (= 32 / $4).

If an audio book costs $8, then Barry should obtain $8 x 8 utils per dollar = 64 utils.

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