\begin{array}{|l|l|l|l|l|l|l|l|l|}
\hline \(\mathrm{Q}\) & 1 & 2 & 3 & 4 & 5 & 6 & 7 & 8 \\
\hline \(\mathrm{Mu}\) & 16 & 14 & 12 & 10 & 8 & 6 & 4 & 2 \\
\hline Mus & 11 & 10 & 9 & 8 & 7 & 6 & 5 & 4 \\
\hline
\end{array}
In the above. The price of commodity \(\mathrm{y}\) is \(\mathrm{N} 2\) and that of \(x\) is \(\mathrm{H} 1\) while the individual has an income of \(+12\). Determine the combination of the two commodities the individual should consume to maximize his utility
\hline \(\mathrm{Q}\) & 1 & 2 & 3 & 4 & 5 & 6 & 7 & 8 \\
\hline \(\mathrm{Mu}\) & 16 & 14 & 12 & 10 & 8 & 6 & 4 & 2 \\
\hline Mus & 11 & 10 & 9 & 8 & 7 & 6 & 5 & 4 \\
\hline
\end{array}
In the above. The price of commodity \(\mathrm{y}\) is \(\mathrm{N} 2\) and that of \(x\) is \(\mathrm{H} 1\) while the individual has an income of \(+12\). Determine the combination of the two commodities the individual should consume to maximize his utility
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Correct Answer: Option B
Explanation:
The consumer will be at equilibrium when \(\frac{\mathrm{MU}_{1}}{P_{1}}=\frac{\mathrm{MU}_{2}}{P_{1}}\)
This happens at 3 units of consumer 's income is exhausted. This happens at 3 units of \(y\) and 6 units of \(x\) \(\frac{\mathrm{MU}_{1}}{P_{1}}=\frac{\mathrm{MU}_{i}}{P_{s}}=\frac{12}{2}=\frac{6}{1}\)
The income is also exhausted:
$$
\begin{array}{l}
P_{1}\left(Q_{1}\right)+P_{1}\left(Q_{1}\right)=\text { Income } \\
2(3)+1(6)=12
\end{array}
$$
The consumer will be at equilibrium when \(\frac{\mathrm{MU}_{1}}{P_{1}}=\frac{\mathrm{MU}_{2}}{P_{1}}\)
This happens at 3 units of consumer 's income is exhausted. This happens at 3 units of \(y\) and 6 units of \(x\) \(\frac{\mathrm{MU}_{1}}{P_{1}}=\frac{\mathrm{MU}_{i}}{P_{s}}=\frac{12}{2}=\frac{6}{1}\)
The income is also exhausted:
$$
\begin{array}{l}
P_{1}\left(Q_{1}\right)+P_{1}\left(Q_{1}\right)=\text { Income } \\
2(3)+1(6)=12
\end{array}
$$