Bridget has a limited income and consumes only wine and cheese; her current consumption choice is four bottles of wine and 10 pounds of cheese. The price of wine is $ 10 per bottle, and the price of cheese is $ 4 per pound. The last bottle of wine added 50 units to Bridget’s utility, while the last pound of cheese added 40 units. a. Is Bridget making the utility- maximizing choice? Why or why not? b. If not, what should she do instead? Why?

I'm sorry, but we haven't seen Economyst for months. At this time none of our other volunteers is an expert in economics.

and you are not much help eother

To determine whether Bridget is making the utility-maximizing choice, we need to compare the marginal utility per dollar spent on wine and cheese.

Let's calculate the marginal utility per dollar for each good:

For wine:
The marginal utility from the last bottle of wine is 50 units.
The price of wine is $10 per bottle.
Therefore, the marginal utility per dollar spent on wine is 50/10 = 5 units per dollar.

For cheese:
The marginal utility from the last pound of cheese is 40 units.
The price of cheese is $4 per pound.
Therefore, the marginal utility per dollar spent on cheese is 40/4 = 10 units per dollar.

Now, let's compare the marginal utility per dollar for wine and cheese:

The marginal utility per dollar for cheese (10 units per dollar) is higher than the marginal utility per dollar for wine (5 units per dollar).

a. Since Bridget is currently consuming more cheese than wine, her current consumption choice is not utility-maximizing. If she were to reallocate some of her spending from cheese to wine, she could increase her overall utility.

b. Bridget should decrease her consumption of cheese and increase her consumption of wine. By doing this, she will be able to increase her overall utility because the marginal utility per dollar for wine is lower than that of cheese. She should reallocate her spending until the marginal utility per dollar is equal for both goods. This means she should consume fewer pounds of cheese and more bottles of wine until the marginal utility per dollar for both goods becomes equal.