A consumer maximizes utility when she consumes at a point where
A)the marginal utility of each good is the same.
B)the marginal utility per dollar spent on each good is the same.
C)the price of each good is the same.
D)All of the above statements are true.

Question

A consumer maximizes utility when she consumes at a point where​
A)​the marginal utility of each good is the same.
B)​the marginal utility per dollar spent on each good is the same.
C)​the price of each good is the same.
D)​All of the above statements are true.

Quizplus · Accepted Answer

The consumer maximizes utility when she consumes at a point where the marginal utility per dollar spent on each good is the same. This means that she is getting the most satisfaction from her money and is not overspending on one good while underspending on another. Additionally, the other options (A and C) do not necessarily lead to utility maximization as they do not take into account the prices of goods and the relative satisfaction gained from each good.

A Consumer Maximizes Utility When She Consumes at a Point