Name Date: IlI. Circle the two correct answers in the parentheses. \"X\" and \"Y
ID: 1104265 • Letter: N
Question
Name Date: IlI. Circle the two correct answers in the parentheses. "X" and "Y" are two commodities. The unit price of X is $10 per unit, while the unit price of Y is $5 per unit. The consumer currently has purchased 7 units of X and 12 units of Y The MU of the 7th unit of X is 25, and the MU of the 12th unit of Y is 15 The consumer, therefore, (is, is not) in an equilibrium situation. He or she should buy less units of (X, Y) while buying more units of the other in order to reach equilibrium where his or her total utility is maximized. IV. Input the correct answer in the blanks or circle where applicable. Given: The consumer has $50 budget. Price of X $10/unit Price of Y $5/unit Qy 10 . 5 Qx 1. At point A, the consumer purchases units of X. 2. At point C, the consumer purchases and spends $on that many units of Y. -units of Y 3. The function or line where points such as A and C are on is called the 4. At point B, the MRSxy is (greater than, less than, equal to) the MRSxy at point A.Explanation / Answer
III. Price of X = $10; price of Y = $5.
Consumer purchased 7 units of X and 12 units of Y.
MU of 7th of X = 25 and MU of 12th unit of Y = 15.
The consumer is not in equilibrium situation.
Because MUX/Px MUY/Py. [25/10 15/5]
He or she should buy less of X while buying more units of the other in order to reach equilibrium where his her total utility is maximized.
IV. 1. At point A, the consumer purchases 2 units of X.
2. At point C. the consumer purchases 2 units of Y and spends $10 on that many units of Y.
3. The function or line where point such as A and C are on is called the budget constraint.
At point B, MRSxy is equal to the MRSxy at point A.
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