Refer to the following graph:
The price of X is $20 and the price of Y is $40.

-If income is $800, how many units of Y will the consumer choose?
A) 6
B) 7
C) 8
D) 9
E) 10

Question

Refer to the following graph:
The price of X is $20 and the price of Y is $40.
 
-If income is $800, how many units of Y will the consumer choose?
A) 6 
B) 7 
C) 8 
D) 9 
E) 10

Quizplus · Accepted Answer

The correct choice depends on the consumer's budget constraint and preferences. Assuming the price of Y and other goods are constant, the consumer will choose the quantity of Y that maximizes their utility given their income of $800. Without additional information on prices or utility functions, the choice of 8 units is assumed to be optimal.

Refer to the Following Graph