Suppose a consumer has preferences over two goods,x and y,which are perfect substitutes.In particular,two units of x is equivalent to one unit of y.If the price of x is $1,the price of y is $3,and the consumer has $30 of income to allocate to these two goods,how much of each good should the consumer purchase to maximize satisfaction?
A)Thirty units of x and zero units of y.
B)Zero units of x and ten units of y.
C)Fifteen units of x and five units of y.
D)Twelve units of x and six units of y.

Question

Quizplus · Accepted Answer

Since two units of x are equivalent to one unit of y, and x is cheaper, the consumer should spend all income on x to maximize satisfaction.

Suppose a Consumer Has Preferences Over Two Goods,x and Y,which