Assume that an individual consumes only coffee and bagels and that the last cup of coffee yields 12 utils and the last bagel 6 utils. If the price of a cup of coffee is $1 and the price of the bagel is $.50, we can conclude that the:
A. consumer should consume more coffee and fewer bagels.
B. price of coffee is too high relative to bagels.
C. consumer should consume less coffee and more bagels.
D. consumer is in equilibrium.
Answer: D
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