Cookies Marginal Glasses Marginal Consumed Utility f Milk Ut

Cookies Marginal Glasses Marginal Consumed Utility f Milk Utility 0 12 18 12 3 4 5 0

Solution

Cookies Consumed

Marginal Utility

Glasses of Milk

Marginal Utility

Cost of Cookies

Cost of Milk

0

0

1

12

1

18

0.5

1

2

9

2

12

1

2

3

6

3

6

1.5

3

4

3

4

0

2

4

5

0

5

-6

2.5

5

From the above table we can see that the utility is maximum when 2 units of cookies and 1 unit of milk is consumed at budget of $2 and the maximumutility is 39

Cookies Consumed	Marginal Utility	Glasses of Milk	Marginal Utility	Cost of Cookies	Cost of Milk
0		0
1	12	1	18	0.5	1
2	9	2	12	1	2
3	6	3	6	1.5	3
4	3	4	0	2	4
5	0	5	-6	2.5	5