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AP Microeconomics 1.6: Marginal Analysis and Consumer Choice

Analyze consumer choices under income and price constraints by comparing marginal utility, marginal benefit, marginal cost, and total utility.

Syllabus
Effective Fall 2025
Course
AP Microeconomics

Covered syllabus points

CBA-2.A—a. Define the key assumptions of consumer choice theory. b. Explain (using a table or graph as appropriate) how a rational…CBA-2.B—a. Define marginal analysis and related terms. b. Explain a decision using marginal analysis (using a table or a graph when…

1.6 Marginal Analysis and Consumer Choice question 1

[Maximum number: 4]

The table provided shows the marginal utility for Lucy when she consumes Good X and Good Y.

Table for Question 1.6 Marginal Analysis and Consumer Choice question 1 — AP Microeconomics

Question (a)

(a)

If Good X and Good Y are free, how many units of each good will maximize Lucy's total

utility?

[ 1 ]

Question (b)

(b)

Calculate Lucy's total utility if she consumes 2 units of Good X and 2 units of Good Y. Show

your work.

[ 1 ]

Question (c)

(c)

Suppose instead that the price of each unit of Good X is $2 and the price of each unit of Good

Y is $4. Lucy has a budget of $20 to spend on the two goods.

[ 2 ]

Question (i)

(i)

If Lucy purchases 2 units of Good X, what is the maximum quantity of Good Y Lucy can

purchase?

[ 1 ]

Question (ii)

(ii)

What is Lucy's optimal combination of Good X and Good Y? Explain your answer using

marginal analysis and numbers.

[ 1 ]

1.6 Marginal Analysis and Consumer Choice question 2

[Maximum number: 1]

Deskward is a typical profit-maximizing firm that produces and sells wooden desks in a

constant-cost, perfectly competitive market that is in long-run equilibrium.

If the monthly rent, a fixed cost, on Deskward's factory building increases, what will happen

to the firm's profit-maximizing quantity in the short run? Explain.

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