-Max has allocated $100 toward meats for his barbecue.His budget line and an indifference map are shown in the above figure.What happens if Max receives a $100 cash grant to buy either meat or chicken?
A) Max will double his consumption of both meats.
B) Max will spend it all on burger. Because of its lower price, he can buy more of it.
C) Max will take advantage of the gift by buying all chicken because it is the more expensive meat.
D) There is not enough information to answer the question.

Question

-Max has allocated $100 toward meats for his barbecue.His budget line and an indifference map are shown in the above figure.What happens if Max receives a $100 cash grant to buy either meat or chicken?
A) Max will double his consumption of both meats. 
B) Max will spend it all on burger. Because of its lower price, he can buy more of it. 
C) Max will take advantage of the gift by buying all chicken because it is the more expensive meat. 
D) There is not enough information to answer the question.

Quizplus · Accepted Answer

The correct answer cannot be determined without additional information such as the prices of the meats, Max's preferences, and how the budget increase affects his consumption choices.

-Max Has Allocated $100 Toward Meats for His Barbecue