Use this **equation** and the **equation** for BL2 to find the **optimal bundle**: Y = 25 – (1/4)(4Y) or Y = 12.5. When Y = 12.5 then x = 50. The individual’s level of utility from consuming this **consumption bundle** is U = XY = (50)(12.5) = 625 units of utility.

Consequently, what is the total utility at the optimal consumption bundle?

An individual chooses the **consumption bundle** that maximizes **total utility**, the **optimal consumption bundle**. The **optimal consumption** rule says that at the **optimal consumption bundle** the marginal **utility** per dollar spent on each good and service—the marginal **utility** of a good divided by its price—is the same.

what is a consumption bundle? A **consumption bundle** is a set of goods that a consumer may choose to **consume**.

One may also ask, what is an optimal bundle?

Def: The **optimal** consumption **bundle** is the **bundle** of goods that is both affordable (con- tained in the budget constraint) and the most preferred by the consumer (highest indifference curve). This **optimal** consumption **bundle** is the **bundle** of goods the consumer will choose.

What is the optimal level of consumption?

The **optimal consumption** rule says that when a consumer maximizes utility, the marginal utility per dollar spent must be the same for all goods and services in the **consumption** bundle.