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If you had already purchased 2 candy bars and had enough money for another candy bar, a pop, gum, or popcorn, which should you buy if the SUs for candy bars were (15 (1st time, 12 (2nd time), 9 (3rd time)), pop is (7,5,3) gum is (8,7,2) and popcorn is (6,5,1) ? REAL ANSWERS ONLY PLS, WILL REPORT...THX

2007-01-29 02:02:22 · 1 answers · asked by Lydia Mahree 2 in Education & Reference Homework Help

1 answers

You should purchase the candy bar. Here is why.
Assuming you want to maximize the standard utility (SU) that you receive from your purchase, you have to see how much utility you derive from each thing. For the candy bar, it is 9. Pop is 7, gum is 8, and popcorn is 6. Thus, the candy bar provides you with more utility, so you should purchase that.

2007-01-29 02:06:50 · answer #1 · answered by theeconomicsguy 5 · 0 0

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