00:01
Let's go over this question.
00:03
Which one of these is jason going to buy? so we need to find the one that gives him the most marginal utility per dollar.
00:12
So the bagel costs 50 cents and it has a marginal utility of 5.
00:20
So for the bagel, marginal utility per dollar is equal to 10.
00:30
Then for the muffet, marginal utility per dollar is going to be 20 because the marginal utility is 20 and the cost is one dollar.
00:45
So therefore he's going to choose the muffin because it has a higher marginal utility per dollar.
00:51
The correct answer is e.
00:55
So for the next one, the ratio of marginal utility to price gives you the marginal utility that derek will obtain from each dollar that he spends on these different goods.
01:19
So he's going to purchase the banana first, then he's going to purchase the apple second because he will purchase the one with the highest marginal utility per dollar first, and then he will purchase the one with the second lowest marginal utility per dollar second.
01:45
If an oligopolis manufacturer believes that he faces a kink demand curve, he thinks that his competitors will lower the prices if he lowers his price and that they will not raise their prices if he raises his price.
02:14
So let's go over what the kinked demand curve is...