Suppose the price of $A$ is $3, the price of $B$ is $5, the consumer's income is $30, and the consumer's level of satisfaction is measured by $A + B$ . The consumer's income constraint is
A) $\max 3 A + 5 B$
B) $\max A + B$
C) $A + B \leq 30$
D) $3 A + 5 B \leq 30$

Question

Quizplus · Accepted Answer

The consumer's income constraint is the maximum amount of money they can spend on $A$ and $B$ combined, which is their income of $30. Using the prices for $A$ and $B$, we get the inequality $3A + 5B \leq 30$ as the income constraint. The consumer's goal is to maximize their level of satisfaction, which is measured by $A + B$. Therefore, the consumer should choose the combination of $A$ and $B$ that satisfies the income constraint and maximizes $A + B$. Solving the inequality, we get the feasible region as $\{(0,0),(0,6),(3,3),(6,0)\}$. Among these choices, the combination that maximizes $A + B$ is $(6,0)$, which gives a level of satisfaction of 6.

Suppose the Price Of AAA Is $3, the Price Of BBB Is $5, the Consumer's Income Is $30, and the Consumer's

Suppose the Price Of $A$ Is $3, the Price Of $B$ Is $5, the Consumer's Income Is $30, and the Consumer's