Assume the price of baseballs is 5 and baseball gloves is 20

Assume the price of baseballs is $5 and baseball gloves is $20. Assume you have $100 total to spend on these items. Construct a table showing utility maximization. What is the point, based on the Equimarginal Rule, which has equal marginal benefit (or the closest) for the two purchases?

Solution

It is a case of perfect complement. The utility function should be U= min(baseball, gloves). There is no optimum rule. The best you can do is 15 base balls and 1 glove,and spent $95, or 12 baseballs and 2 gloves, and spent $100.