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jmoney5 jmoney5
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5 years ago

Question 1.

The real-income effect of a price change is most significant when

• the substitution effect is insignificant.

• the marginal utility per dollar spent on the last unit is high.

• the substitution effect is significant too.

• the good under consideration constitutes a major portion of the consumer's budget.

Question 2.

If a consumer is initially at an optimum, and then the price of Y decreases, then

• MUX/MUY < PY/PX.

• MUX/PX > MUY/PY.

• MUX/PX < MUY/PY.

• MUX/PX = MUY/PY.
Textbook 
Economics Today: The Micro View

Economics Today: The Micro View


Edition: 19th
Author:
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BakariBakari
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#1
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5 years ago
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jmoney5 Author
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5 years ago
Smart ... Thanks!
bkrandy
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Yesterday
This site is awesome
oscar520000
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2 hours ago
Good timing, thanks!
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