A consumer has income I and faces prices p1 and p2 for goods 1 and 2. The corresponding quantities are denoted by x1 and x2. The consumer's preferences can be described with utility function u(x1, X2) = x1 + X2. Suppose the budget line is given by x2 = 100 – 2x1. One of the following statements is true. Which statement is true? A The consumer's optimal consumption bundle satisfies x1 > x2. The consumer's optimal consumption bundle satisfies x1 = x2. C The consumer's optimal consumption bundle satisfies X1

A consumer has income I and faces prices p1 and p2 for goods 1 and 2. The corresponding quantities are denoted by x1 and x2. The consumer's preferences can be described with utility function u(x1, X2) = x1 + X2. Suppose the budget line is given by x2 = 100 – 2x1. One of the following statements is true. Which statement is true? A The consumer's optimal consumption bundle satisfies x1 > x2. The consumer's optimal consumption bundle satisfies x1 = x2. C The consumer's optimal consumption bundle satisfies X1

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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