Suppose that an ice-cream is sold for Rs 30. Laxmi, who loves ice-cream, has already eaten 3. Her marginal utility from eating the 3^(rd) ice-cream is 90 utils. If MU of Rs 1 is 3 utils, should she eat more ice-creams or should she stop ?

Suppose that an ice-cream is sold for Rs 30. Laxmi, who loves ice-crea

1.	Suppose that an ice-cream is sold for Rs 30. Laxmi, who loves ice-cream, has already eaten 3. Her marginal utility from eating the 3^(rd) ice-cream is 90 utils. If MU of Rs 1 is 3 utils, should she eat more ice-creams or should she stop ?
Answer» <html><body><p></p><a href="https://interviewquestions.tuteehub.com/tag/solution-25781" style="font-weight:bold;" target="_blank" title="Click to know more about SOLUTION">SOLUTION</a> :<a href="https://interviewquestions.tuteehub.com/tag/given-473447" style="font-weight:bold;" target="_blank" title="Click to know more about GIVEN">GIVEN</a>: Price `(P_(IC)) = Rs 30`, Marginal <a href="https://interviewquestions.tuteehub.com/tag/utility-1441817" style="font-weight:bold;" target="_blank" title="Click to know more about UTILITY">UTILITY</a> from eating `3^(rd)`ice-cream = <a href="https://interviewquestions.tuteehub.com/tag/90-341351" style="font-weight:bold;" target="_blank" title="Click to know more about 90">90</a> utils. Value of 3 utils = Rs i.e., `MU_(M) = 3`. <br/> MU in terms of Money `(MU_(IC)) = (MU " in Utils")/(MU_(M)) = (90)/(3) = 30` <br/> Laxmi should not consume any more ice -creasn as the condition for consumer equilibrium `''MU_(IC) = P_(IC)''`is <a href="https://interviewquestions.tuteehub.com/tag/satisfied-636887" style="font-weight:bold;" target="_blank" title="Click to know more about SATISFIED">SATISFIED</a> at `3^(rd)` ice-cream.</body></html>