3. Apoorva spends her entire income on (*good") goods X and Y, which she views as neither perfect complements nor perfect substitutes (i.e., she has "standard-looking" indifference curves). Which of the following statements is always a incorrect characterization of Apoorva's optimal consumption bundle? a) MUx/MUy = Px/PY b) Apoorva has no income left over. c) Apoorva attains the highest utility level possible, given her budget constraint. d) Apoorva consumes positive amounts of both X and Y. e) None of the above.

Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter6: Consumer Choice Theory
Section6.A: Indifference Curve Analysis
Problem 3SQP
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3. Apoorva spends her entire income on ("good") goods X and Y, which she views as neither perfect
complements nor perfect substitutes (i.e., she has "standard-looking" indifference curves). Which
of the following statements is always a incorrect characterization of Apoorva's optimal
consumption bundle?
a) MUx/MUy = Px/PY
b) Apoorva has no income left over.
c) Apoorva attains the highest utility level possible, given her budget constraint.
d) Apoorva consumes positive amounts of both X and Y.
e) None of the above.
4. Tyrone spends his entire income on two goods, X, and Y. His utility function is U=XY, and the
market prices for X and Y are identical (Px=Py). The equation for Tyrone's income-consumption
curve is
a) Y=X.
b) Y=1.
c) X=1.
d) MUx/MUY.
e) indeterminate given this information.
Transcribed Image Text:3. Apoorva spends her entire income on ("good") goods X and Y, which she views as neither perfect complements nor perfect substitutes (i.e., she has "standard-looking" indifference curves). Which of the following statements is always a incorrect characterization of Apoorva's optimal consumption bundle? a) MUx/MUy = Px/PY b) Apoorva has no income left over. c) Apoorva attains the highest utility level possible, given her budget constraint. d) Apoorva consumes positive amounts of both X and Y. e) None of the above. 4. Tyrone spends his entire income on two goods, X, and Y. His utility function is U=XY, and the market prices for X and Y are identical (Px=Py). The equation for Tyrone's income-consumption curve is a) Y=X. b) Y=1. c) X=1. d) MUx/MUY. e) indeterminate given this information.
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