Ouomit Quiz waya pends her $50 budget on two goods, cans of tuna and bottes of ginger ale. Initially, the marginal utility per dollar she spends on tuna is equal to the marginal utility per dollar she spends on ginger ale. Then the price of ginger ale decreases, while her income and the price of tuna does not change a. Her marginal ubity from consuming ginger ale b. The marginal utity per dollar she spends on ginger ale e. Because of the substhution effect, Maya wil buy more ginger ale. Can we condlude that ginger ale isa nomal good? OA No, because ginger ale is an inferior good. B. No, because ginger ale is a Gifen good. OC Yes, ginger ale must be a normal good. OD. No, because nomal and interior good designations are related to the income effect, not the subatihution effect 4. As Maya adjusts to the change in the price of ginger ale, her marginal utility per dollar spent on tuna wil OA decrease because she will buy less tuna OB. norease because she will buy less tuna Oc norease because she will buy more tuna OD. decrease because she wil buy more tuna
Ouomit Quiz waya pends her $50 budget on two goods, cans of tuna and bottes of ginger ale. Initially, the marginal utility per dollar she spends on tuna is equal to the marginal utility per dollar she spends on ginger ale. Then the price of ginger ale decreases, while her income and the price of tuna does not change a. Her marginal ubity from consuming ginger ale b. The marginal utity per dollar she spends on ginger ale e. Because of the substhution effect, Maya wil buy more ginger ale. Can we condlude that ginger ale isa nomal good? OA No, because ginger ale is an inferior good. B. No, because ginger ale is a Gifen good. OC Yes, ginger ale must be a normal good. OD. No, because nomal and interior good designations are related to the income effect, not the subatihution effect 4. As Maya adjusts to the change in the price of ginger ale, her marginal utility per dollar spent on tuna wil OA decrease because she will buy less tuna OB. norease because she will buy less tuna Oc norease because she will buy more tuna OD. decrease because she wil buy more tuna
Chapter10: Consumer Choice Theory
Section: Chapter Questions
Problem 8P
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