Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Buy 10 bananas and 0 apples.
B
Buy 5 apples and 0 bananas.
C
Buy 4 apples and 4 bananas.
D
Buy 2 apples and 8 bananas.
Understanding the Answer
Let's break down why this is correct
Answer
To maximize her utility, Maria should compare the marginal utility per dollar spent on each fruit. For apples, the marginal utility is 6 and they cost $2 each, so the utility per dollar is 3 (6 divided by 2). For bananas, the marginal utility is 3 and they cost $1 each, giving her a utility per dollar of 3 as well (3 divided by 1). Since both fruits provide the same utility per dollar, Maria can choose to buy any combination of apples and bananas as long as she stays within her $20 budget. For example, if she buys 5 apples for $10 and 10 bananas for $10, she will maximize her fruit intake and enjoy the same level of utility per dollar.
Detailed Explanation
Maria gets the most satisfaction by buying a mix of apples and bananas. Other options are incorrect because This choice focuses only on bananas; Here, Maria spends all her money on apples.
Key Concepts
Maximizing Utility
Budget Constraints
Marginal Utility
Topic
Maximizing Utility with Budgets
Difficulty
medium level question
Cognitive Level
understand
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