In the economy of Mungo, there is a third person called Ike.Ike has a red income of 88 and a blue income of 30.Recall that blue prices are 1 bcu (blue currency unit)per unit of ambrosia and 1 bcu per unit of bubble gum.Red prices are 2 rcus (red currency units per unit of ambrosia and 6 rcus per unit of bubble gum.You have to pay twice for what you buy, once in red currency, once in blue currency.If Ike spends all of his blue income but not all of his red income, he must consume
A)at least 23 units of ambrosia.
B)exactly twice as much bubble gum as ambrosia.
C)at least 17 units of bubble gum.
D)at least 7 units of bubble gum.
E)equal amounts of ambrosia and bubble gum.

Question

Quizplus · Accepted Answer

If Ike spends all his blue income of 30 bcu, he can buy 30 units of ambrosia or bubble gum. To not spend all his red income, he must buy at least 23 units of ambrosia, as 23 units cost 46 rcus, leaving him with 42 rcus, which is less than his total red income of 88 rcus.

In the Economy of Mungo, There Is a Third Person