Ice Capp ($2)
Quantity Marginal Utility Total Utility
0 0 0
1 20 20
2 16 36
3 12 48
4 8 56
5 4 60
Tim-bits ($4)
Quantity Marginal Utility Total Utility
0 0 0
1 32 32
2 16 48
3 12 60
4 4 64
5 8 66
Utility Maximizing Combination:
4 Ice Capps - (MU/P=1) $8
4 Ice Capps - (MU/P=1) $8
3 Tim-bits - (MU/P=1) $12
Total- $20
This is the utility maximizing combination because MU/P is equal for both goods, and the total cost to purchase these quantities of both goods is $20
This is the utility maximizing combination because MU/P is equal for both goods, and the total cost to purchase these quantities of both goods is $20