Please answer the next 5 questions based on the consumption for an individual co
ID: 1135049 • Letter: P
Question
Please answer the next 5 questions based on the consumption for an individual consumer as presented in the table below. Price (of x) Quantity (of x) TUX MUx 10 43 42 25. The MU of the first unit of x is. 26. The MU of the third unit of x is . 27. The MU of the sixth unit of x is 28. The TU of the second unit of x is 29. Which of the following statements are correct? a. Demand is price elastic in the $2 to $0 price range. b. Demand is price inelastic in the $5 to $3 price range. c. Demand is price elastic in the $3 to $O price range. d. The expenditure on x by this consumer is at a maximum when Q is s. e. Demand is price inelastic in the $3 to $0 price range.Explanation / Answer
Marginal utility at 2 unit = Total utility at 2 unit - Total utility at 1 unit
10 = TU at 2 unit -15
TU at 2 nd unit = 10+15= 25
Total utility at 4 unit = MU at 4 unit + TU at 3 unit
TU at 4 unit = 6+33 = 39
25) MU at first unit = 15
26) MU at third unit = 8
27)MU at sixth unit = -1
28) TU at second unit = 25
Price Quantity Total utility Marginal utility 5 1 15 15 4 2 25 (25-15) = 10 3 3 33 (33-25)= 8 2 4 (33+6) = 39 6 1 5 43 (43-39)=4 0 6 42 (42-43) = -1