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30 August, 06:14

Astrid currently consumes only milk and honey. She drinks four quarts of milk priced at $3 per quart and gets 30 utils for the last quart. She consumes thirteen jars of honey at a price of $0.75 per jar and gets 7.5 utils for the last jar. Is Astrid maximizing her utility?

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  1. 30 August, 08:51
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    Yes, the Astrid maximizing her utility

    Explanation:

    Given that

    Utils for the last quart = 30

    Per quart = $3

    Honey price = $0.75

    Utils of Last jar = 7.5

    The calculation of maximum utility is given below:-

    Per dollar utility gained by milk

    = 30 : 3

    = 10 utils

    Milk utility for $0.75

    = 30 : 3 * $0.75

    = 7.5 utils

    Therefore from the last quart the utility was same and the dollars was spent in last jar. So, Astrid can maximizing her utility.
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