Initially, a consumer is at an optimum. Then the price of Y increases. Consequently

A) MUX/PX < MUY/PY.
B) MUX/PX > MUY/PY.
C) MUX/PX = MUY/PY.
D) MUX > MUY.


Answer: B

Economics

You might also like to view...

Because of the popularity of the movie "Frozen," there is a large increase in demand for the merchandise, there is also many new companies producing items from backpacks, to dresses, to "Frozen" themed food items. How has this affected the market for "Frozen" merchandise?

A. Price increases and quantity is indeterminate. B. Quantity increases and price is indeterminate. C. Price decreases and quantity is indeterminate D. Quantity decreases and price is indeterminate.

Economics

Economies of scale are created by greater efficiency of capital and by

A) longer chains of command in management. B) better wages for labor. C) smaller plant sizes. D) increased specialization of labor.

Economics

When national income in other nations decreases, aggregate demand in our economy ________.

A. decreases because our imports will increase B. decreases because our exports will decrease C. increases because our imports will decrease D. increases because our exports will increase

Economics

If the price of the Brazilian real is 60 cents and a U.S. resident purchases a Brazilian-manufactured item for 60,000 real, there will be

A) a quantity demanded of 60,000 real and a quantity supplied of $60,000. B) a quantity demanded of 60,000 real and a quantity supplied of $36,000. C) a quantity demanded of 60,000 real, but we cannot determine the effect in the market for dollars. D) a quantity supplied of 60,000 real and a quantity demanded of 60,000 yen.

Economics