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# Marginal utility and optimal consumption

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The attached table displays George's consumption of soda pop and pretzels. The price of each soda pop is \$2.00 and the price of each pretzel is \$5.00.

A. Fill in the missing total utility, marginal utility, and marginal utility/price (MU/Price). Place the final answer for each in the correct shaded area within the table.

B. George has \$28.00 to spend on soda pop and pretzels. Determine the number of cans of soda pop and pretzels that will be optimal for George. Explain your reasoning regarding how you chose that consumption point.

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#### Solution Preview

See the attachments.
QUESTION A
Bottles of Soda Pop Number of Pretzels
Bottles of Soda Pop Consumed Total Utility Marginal Utility MU/Price Number of Pretzels Consumed Total Utility Marginal Utility MU/Price
0 0 NA NA 0 0 NA NA
1 20 20 10.00 2 50 50 10.00
2 38 18 9.00 4 70 20 ...

#### Solution Summary

Solution offers Excel and Word documents showing how to find total utility, marginal utility and MU/price for soda pop and pretzels. A excel file is used in the calculations.

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