A consumer consumes two normal goods,pretzels and Mt.Dew.When the price of Mt.Dew is $0.50 per can,the consumer purchases 40 cans.When the price rises to $0.65 per can,the consumer purchases 30 cans.We can use the information provided by the consumer's optimum choices to derive the
A) demand curve.
B) supply curve.
C) production possibilities frontier.
D) labor-leisure tradeoff.

Question

Quizplus · Accepted Answer

The consumer's optimum choices at different prices of Mt. Dew can be used to derive the demand curve for Mt. Dew. By connecting the points of quantity demanded at different prices, we can plot a downward-sloping demand curve that shows the inverse relationship between the price of Mt. Dew and the quantity of Mt. Dew that the consumer is willing and able to purchase.

A Consumer Consumes Two Normal Goods,pretzels and Mt