Description of this paper

A consumer must divide

Description

solution


Question

3 A consumer must divide $250 between the consumption of product X and product Y. The relevant prices are Px =$5 and Py = $10;a Write the equation for the consumer?s budget line.;b Illustrate the consumer?s opportunity set in a carefully labeled diagram.;c Show how the consumer?s opportunity set changes when the price of good X increases to $10. How does this change alter the market rate of substitution between goods X and Y?

 

Paper#26439 | Written in 18-Jul-2015

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