Answer:
No.
Explanation:
David is maximizing his utility at a point where the marginal utility per dollar from a scoop of ice cream is equal to the marginal utility per dollar from a can of Dr. pepper.
Given that,
Marginal utility from a scoop of ice cream, MU_I = 8
Marginal utility from a can of Dr.Pepper, MU_D = 4
current price of a scoop of ice cream, P_I = 50 cents = 0.50
cost of a can of Dr. Pepper = 35 cents, P_D = 0.35
Therefore,
(MU_I) ÷ (P_I) = 8 ÷ 0.50
= 16
(MU_D) ÷ (P_D) = 4 ÷ 0.35
= 11.43
Hence, David is not maximizing his utility.
He can maximize his utility by consuming less ice cream and consuming more Dr.Pepper.
