Consider a market with two households (A and B) and two goods (X and Y). Each household holds 12 units of each good. Household A has a utility UA = 5 ln TA + InyA when it consumes bundle (TA, YA). Household B hasa utility UB = In aB+5 In yg when it consumes bundle (тв, ув). The market reaches an equilibrium when the price of each good is $1. Which, of the following sentences, correctly explains what happens in the market? O Household A purchases 8 units of good X from household B. Household B purchases 8 units of good Y from household A. O Household A purchases 7 units of good Y from household B. Household B purchases 7 units of good X from household A. Household A purchases 9 units of good X from household B. Household B purchases 9 units of good Y from household A. O Household A purchases 7 units of good X from household B. Household B purchases 7 units of good Y from household A. Household A purchases 9 units of good Y from household B. Household B purchases 9 units of good X from household A. O HouseholdA purchases 8 units of good Y from household B. Household B purchases 8 units of good X from household A.

Consider a market with two households (A and B) and two goods (X and Y). Each household holds 12 units of each good. Household A has a utility UA = 5 ln TA + InyA when it consumes bundle (TA, YA). Household B hasa utility UB = In aB+5 In yg when it consumes bundle (тв, ув). The market reaches an equilibrium when the price of each good is $1. Which, of the following sentences, correctly explains what happens in the market? O Household A purchases 8 units of good X from household B. Household B purchases 8 units of good Y from household A. O Household A purchases 7 units of good Y from household B. Household B purchases 7 units of good X from household A. Household A purchases 9 units of good X from household B. Household B purchases 9 units of good Y from household A. O Household A purchases 7 units of good X from household B. Household B purchases 7 units of good Y from household A. Household A purchases 9 units of good Y from household B. Household B purchases 9 units of good X from household A. O HouseholdA purchases 8 units of good Y from household B. Household B purchases 8 units of good X from household A.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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