Answer to Question #161885 in Microeconomics for Peehu

Question

If one chocolate sells for rs. 20 you have already consumed 3 chocolates and utility derived from 3rd chocolate is 80 utils if 1re = 10 utils find the consumer reaction to reach equilibrium

Answer 1

$$\frac {MU_x}{p_X}=10K$$

$$TU_3=80$$

$$P_x=20$$

$$MU_x=200K$$

$$200K=80$$

$$K=0.4$$