Math Problem Statement
Manuela has $27 to spend on food. She uses it to buy hamburgers and frozen pizzas. The table below shows Manuela's marginal utility (MU) for both hamburgers and frozen pizzas. Assume that Manuela is a rational consumer who wants to maximize her utility. If the price of a hamburger is $5 and the price of a frozen pizza is $4, Manuela will choose to buy____ frozen pizzas. Hint: You will need to calculate marginal utility per dollar spent (MU/P) for both hamburgers and pizza.
Solution
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Math Problem Analysis
Mathematical Concepts
Marginal Utility
Budget Allocation
Optimization
Formulas
MU/P = Marginal Utility / Price
Theorems
Law of Diminishing Marginal Utility
Suitable Grade Level
Grade 11-12
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