Question #11100336

Economics budget line?

*Help please!! (: Later, Jerry walks into a music store. Jerry enjoys purchasing two goods: guitars and music sheets. The price of a music sheet is $5, while the price of a guitar is $100. Currently, Jerry’s marginal utility from buying another music sheet is 15, while his marginal utility from buying another guitar is 350. Jerry’s total budget for buying guitars and music sheets is $400. c) Write down an equation for Jerry’s budget line. Use G and M for the variables guitars and music sheets, respectively. d) Is Jerry consuming optimally? If not, how should he change his consumption to be optimal? How do you know?

2013-10-15 06:15:52

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