Question

You and 3 members of your family watching a film in Vox Cinemas, decided to buy cokes and popcorns and have only 40 SAR in your pocket How many cokes

and popcorns would you buy to maximize total utility of the family, if the price of popcorn is (5) SAR and the price of coke is (4) SAR. In the table below, you have a list of marginal utility,you expect to receive from various level of popcorns and cokes: 1. Fill the table above. 2. How many popcorns and cokes would you buy to maximize family utility? 3. What is the level of total utility in this case? What is the level of Marginal Rate of substitution (MRS) and its relation to the indifference curve? . Define the equation where utility is maximized for the two goods, subject to the budget constraint?

Fig: 1

Fig: 2

Fig: 3

Fig: 4

Fig: 5

Fig: 6

Fig: 7