If the utility for two goods "x" and "y" can be measured as U = y,then it can be concluded that
A)"x" and "y" are perfect complements.
B)"x" is a "bad".
C)the indifference curves on the x,y graph are upward sloping where "x" is measured on the horizontal axis.
D)the indifference curves on the x,y graph are horizontal where "x" is measured on the horizontal axis.

Question

Quizplus · Accepted Answer

Since utility U only depends on the quantity of good "y" and is independent of "x", the indifference curves, which represent combinations of "x" and "y" yielding the same utility, will be horizontal lines. This is because changes in the quantity of "x" do not affect utility, implying that the consumer's satisfaction is unaffected by the amount of "x" consumed.

If the Utility for Two Goods "X" and "Y" Can