?Suppose the marginal utility of a unit of good x = MUx, the marginal utility of a unit of good y = MUy, Px= price of a unit of good x, and Py= price of a unit of a goo?d y. A utility-maximizing consumer who purchases two goods, x and y, allocates her budget in such a way that _____.

a. ?MUx = MUy
b. ?TUx/Py = TUy/Px
c. ?MUx/Px = MUy/Py
d. ?TUx = TUy
e. ?MUx/Py = MUy/Px


Ans: b. ?TUx/Py = TUy/Px

Economics

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Economics