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(i)Determine the quantity of apples a consumer would buy at a given price in the market. Use cardinal utility analysis (ii) What quantity of apples would he consume if apples are available free of cost?

Answer» <html><body><p><br/></p>Solution :(i)<a href="https://interviewquestions.tuteehub.com/tag/consumer-25599" style="font-weight:bold;" target="_blank" title="Click to know more about CONSUMER">CONSUMER</a> equilibrium is <a href="https://interviewquestions.tuteehub.com/tag/determined-949906" style="font-weight:bold;" target="_blank" title="Click to know more about DETERMINED">DETERMINED</a> at a point where marginal utility (Rs) of apples <a href="https://interviewquestions.tuteehub.com/tag/would-3285927" style="font-weight:bold;" target="_blank" title="Click to know more about WOULD">WOULD</a> be equal to price paid for apples. <br/> (ii)In case of apples are available <a href="https://interviewquestions.tuteehub.com/tag/free-465311" style="font-weight:bold;" target="_blank" title="Click to know more about FREE">FREE</a> of cost, the consumer will stop consumption at the point of satiety i.e, when MU=0. It is because as per the <a href="https://interviewquestions.tuteehub.com/tag/condition-409743" style="font-weight:bold;" target="_blank" title="Click to know more about CONDITION">CONDITION</a> of consumer equilibrium <br/> `MU_("apples")=Price_("apples")`=zero <br/> <img src="https://d10lpgp6xz60nq.cloudfront.net/physics_images/MIC_ECO_XI_U02_C02_E01_046_S01.png" width="80%"/></body></html>


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