A basket of goods for a given consumer includes two goods, X and Z. Consumer income is equal to $1,500 and the prices of these two goods are as follows: P= $20 P, $25 This consumer is consuming 10 units of good X. Suppose that over the course of a year, the price of good X changes by 10% and the price of good Z changes by -10%. How much income would be required for the consumer to afford the same quantity of goods X and Z with the new prices? S

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A: There are two products, i.e., A and B. Income (m) = 60. Price of good A (Pa) = 4 Price of good B…

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A:

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A:

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Q: Suppose a consumer can afford to buy 6 units of good 1 and 8 units of good 2 if she spends her…

A: P1=Rs 6 P2=Rs 8 Q1=6 Q2=8

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A:

Q: If the consumer's income rises to $100 while the prices of pizza and cola are constant, then the…

A: Budget line would increase and rotate outwards towards cola axis.

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Q: How does a consumer’s optimal choice of goods change if all prices and the consumer’s income double?

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A: Here,

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Q: John consumes 20 units of food and 24 units of clothing. If food is an inferior good, will John be…

A: Inferior good is the one whose demand declines with increase in income.

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