Redistribute income from Victoria to Fredrick
Work Step by Step
Marginal utility for the last dollar spent for 1. Victoria is 10 utils 2. Fredrick is 15 utils Redistributing income from Victoria to Fredrick till their marginal utilities for the last dollar spent become equal will maximize the combined total marginal utility. This is because the redistributed income will give more marginal utility to Fredrick than it was giving to Victoria and thus the combined total utility will be maximized.