level of total utility. This step-by-step approach will reach the same conclusion regardless of José’s starting

point.

We can develop a more systematic way of using this approach by focusing on satisfaction per dollar. If an item

costing $5 yields 10 utils, then it’s worth 2 utils per dollar spent. Marginal utility per dollar is the amount of

additional utility José receives divided by the product's price. Table 6.5 shows the marginal utility per dollar

for José's T shirts and movies.

If José wants to maximize the utility he gets from his limited budget, he will always purchase the item with the

greatest marginal utility per dollar of expenditure (assuming he can afford it with his remaining budget). José
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