Answer Happy

1-) Suppose that Mr. Whipple spends his entire income on Charmin and Kleenex. The marginal utility of each good (shown below) is independent of the amount consumed of the other good. The price of Charmin is $1/ roll and the price of Kleenex is 50 cents a box. If Mr. Whipple has an income of $5 per week, how many units of each good should he purchase? Number of Units Marginal Utility Consumed Charmin 1 40 30 20 10 8 1 I 2-) At the current level of output for the Fellows Corporation, the marginal product of labor is 25 units while the marginal product of capital is 45 units. Prices are $5 per hour for labor and $8 per hour for capital. On the basis of this information, we know that (multiple choice, pick a single answer). (No calculation is needed) A. This is not optimal allocation. This firm uses too much labor and too little capital. B. This is not optimal allocation. This firm uses too much capital and too little labor. C. This is an optimal allocation. This firm uses the right balance of inputs. 2345678 Kleenex 30 25 8888888 18 15