Suppose Andy has a utility function of U (x, y) = 2x + y and a wealth level of 12. The price of good X is 2 and the price of good Y is 1. Which of the following statement is optimal? Andy will not spend all 12 dollars. Andy will necessarily spend all the wealth on the consumption of Good X. All other options are incorrect. There are multiple optimal market baskets. Andy will necessarily spend all the wealth on the consumption of Good Y.
Suppose Andy has a utility function of U (x, y) = 2x + y and a wealth level of 12. The price of good X is 2 and the price of good Y is 1. Which of the following statement is optimal? Andy will not spend all 12 dollars. Andy will necessarily spend all the wealth on the consumption of Good X. All other options are incorrect. There are multiple optimal market baskets. Andy will necessarily spend all the wealth on the consumption of Good Y.
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter6: Consumer Choice Theory
Section: Chapter Questions
Problem 1SQ
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