At her current level of consumption, Jess gets half as much marginal utility from an additional bagel as from an additional muffin. If the price of muffin is $2 each, then Jess is maximizing her utility if the price of a bagel is:

$1

Explanation:

Utility is the satisfaction a person derives from consumption of a product.

Consumers seek to maximise utility when they have choices between products.

They choose products that gives them most satisfaction.

In this scenario gets 0.5 unit satisfaction from consuming a bagel to 1 unit of satisfaction from consuming muffins.

She will maximise utility in bagels when she pays a price that will give her satisfaction of consuming one muffin.

Therefore

0.5 utility on bagel = x

1 utility on muffin = $2

Cross multiply

x = ( 2 * 0.5) ÷ 1

x = $1

So Jess gets same satisfaction from 2 bagels as she gets from $2 of muffin