QUASILINEAR PREFERENCES: Please explain this!!
Posted by
X on
Feb 09, 2014; 3:20pm
URL: http://discussion-forum.276.s1.nabble.com/QUASILINEAR-PREFERENCES-Please-explain-this-tp7584712.html
I am posting these pages from Varian's Intermediate Microeconomics :


I can't understand here these lines:
"As income increases the marginal utility of consumption of good 1 decreases.
When m = p2, the marginal utility from spending additional income on good
1 just equals the marginal utility from spending additional income on good 2.
After that point, the consumer spends all additional income on good 2."
I will be obliged if am explained.