Figure 21-19
The following graph illustrates a representative consumer's preferences for marshmallows and chocolate chip cookies:

-Refer to Figure 21-19.Assume that the consumer has an income of $40,the price of a bag of marshmallows is $2,and the price of a bag of chocolate chips is $2.The optimizing consumer will choose to purchase which bundle of marshmallows and chocolate chips?
A) A
B) B
C) C
D) D

Question

Figure 21-19
The following graph illustrates a representative consumer's preferences for marshmallows and chocolate chip cookies:
 
-Refer to Figure 21-19.Assume that the consumer has an income of $40,the price of a bag of marshmallows is $2,and the price of a bag of chocolate chips is $2.The optimizing consumer will choose to purchase which bundle of marshmallows and chocolate chips?
A) A 
B) B 
C) C 
D) D

Quizplus · Accepted Answer

The consumer's budget allows for 20 items (40/2), and bundle C is the only option that fits within this budget constraint while maximizing utility.

Figure 21-19 The Following Graph Illustrates a Representative Consumer's Preferences for Marshmallows