Andy derives utility from two goods, potato chips (Qp) and Cola (Qc). Andy receives zero utility unless he consumes some of at least one good. The marginal utility that he receives from the two goods is given as follows:
Qp MUp Qc MUc
1 12 1 24
2 10 2 22
3 8 3 20
4 6 4 18
5 4 5 16
6 2 6 14
7 -2 7 12
8 4 8 10
Refer to Scenario, what is the total utility that Andy will receive if he consumes 5 units of potato chips (Qp) and no Cola drink (Qc)?

Total utility is the sum of marginal utility obtained by consuming different units of the good. So at 5 units of potato chips (Qp) and 0 units of Cola drink (Qc) , we can find total utility by adding marginal utility till 5th unit of Qp.

[tex]Total utility = 12 + 10 + 8 + 6 + 4 \\ = 40[/tex]

Thus, total utility from 5 units of potato chips and no cola is 40 utils.

andromache andromache · Answer 2 · 2021-12-30T11:48:29+01:00

andromache andromache

30-12-2021

The total utility that Andy will receive if he consumes 5 units of potato chips (Qp) and no Cola drink (Qc) is 40.

The calculation is as follows:

= 12 + 10 + 8 + 6 + 4

= 40 utils

Therefore we can conclude that The total utility that Andy will receive if he consumes 5 units of potato chips (Qp) and no Cola drink (Qc) is 40.

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