Should she buy less sushi and more soy milk

Reference no: EM13179742

Katie likes sushi(S) and soy milk(M).Her in difference curves are bowed in and toward

the origin and do not intersect the axes. The price of sushi is $10 and the price of soy milk is $2. She is spending all her income at the basket she is currently consuming, and her marginal rate of substitution of sushi for soy milk is 4. Is she at an optimum? If so, show why. If not, should she buy less sushi and more soy milk, or the reverse?

Reference no: EM13179742

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