2 367 8910 Jam a. a decrease in the price of tbrethe graph, what change forces t

Question

2 367 8910 Jam a. a decrease in the price of tbrethe graph, what change forces the consumer to move to point A? b. an increase in the price of jam c. a decrease in the price of jam d. an increase in the price of bread 32 Refer to Figure 13-6. Ass ume that the consumer depicted in the figure faces prices and income such that sh in the price of bread 33. Refer to Figure 13-6. Suppose the consumer is consuming at a point where the MRSxy > Px/Py. If the consumer is a utility maximizer, he/she will respond by? a. Consuming less jam and less bread b. Consuming less jam and more bread c. Consuming more jam and less bread d. Consuming more jam and more bread 34. Refer to Figure 13-6. Assume that the consumer depicted in the figure has an income of $20 to spend entire on jam and bread. The price of a loaf of bread is $4. This consumer will choose a consumption bundle whe the marginal rate of substitution is equal to which of the following? b. 1/2 c. 1/3 d. 2/3 35. Typically, as a firm revenue product? a. The marginal product of labour and the marginal revenue product both de happens to the marginal product of labour and the marg b. The c. The marginal product of labour d. The marginal product of labour decreases and the marginal revenue product increases bour decreases and the marginal revenue product stays constant. stays constant and the marginal revenue product decreases. marginal product of la

Explanation / Answer

Utility maximisation condition are;

MRS of X and Y = Px/Py

Jam is good X and Bread is Good Y,

MRS of X and Y=MU of X and MU of Y

MRS of X and Y > Px/Py

So consumer will consume more of Jam, so the MU of Jam will decrease, and he will consume less quantity of Bread, So the MU of bread will increase. This will continue until the utility maximisation condition is satisfied.

Therefore it can be said that he will consume more jam and less bread.

Hence option C is the correct answer.

Related Questions

Navigate

• Browse (All)
• Browse 2
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.