The below table shows the average utility (in utils) obtained from the consumption of goods A and B.Table 7.3

-As long as the marginal utilities per dollar obtained from the last unit of all products consumed are the same, _____.
A)the consumer is in equilibrium and will not reallocate income
B)the consumer is not in equilibrium and will reallocate income
C)the consumer is most likely operating a budget deficit
D)the consumer is not maximizing utility
E)the government will recognize this as an intolerable disequilibrium and will most likely intervene by imposing a tax and reallocate the consumer's income

Question

The below table shows the average utility (in utils) obtained from the consumption of goods A and B.Table 7.3
 
-As long as the marginal utilities per dollar obtained from the last unit of all products consumed are the same, _____.
A)the consumer is in equilibrium and will not reallocate income 
B)the consumer is not in equilibrium and will reallocate income 
C)the consumer is most likely operating a budget deficit 
D)the consumer is not maximizing utility 
E)the government will recognize this as an intolerable disequilibrium and will most likely intervene by imposing a tax and reallocate the consumer's income

Quizplus · Accepted Answer

When the marginal utilities per dollar obtained from the last unit of all products consumed are the same, the consumer is in equilibrium, and there is no need for income reallocation. Therefore, Choice A is the correct answer. The other options are not relevant in this scenario.

The Below Table Shows the Average Utility (In Utils) Obtained