Suppose a consumer spends her income on two goods: music CDs and DVDs. The consumer has $200 to allocate to these two goods, the price of a CD is $10, and the price of a DVD is $20. What is the maximum number of DVDs the consumer can purchase?

Question

Quizplus · Accepted Answer

The consumer has $200 and each DVD costs $20. Therefore, the maximum number of DVDs she can purchase is $200 / $20 = 10 DVDs.

Suppose a Consumer Spends Her Income on Two Goods: Music