Use the following to answer questions:
Figure: Music and Movie Downloads 5
-(Figure: Music and Movie Downloads 5) Refer to the figure. What caused the consumer's optimal consumption bundle in this figure to switch from bundle A to bundle B?
A) a decrease in consumer income
B) a decrease in the price of music downloads
C) an increase in the price of music downloads
D) an increase in the price of movie downloads

Question

Use the following to answer questions:
Figure: Music and Movie Downloads 5 
-(Figure: Music and Movie Downloads 5) Refer to the figure. What caused the consumer's optimal consumption bundle in this figure to switch from bundle A to bundle B?
A) a decrease in consumer income 
B) a decrease in the price of music downloads 
C) an increase in the price of music downloads 
D) an increase in the price of movie downloads

Quizplus · Accepted Answer

The switch from bundle A to bundle B shows that the consumer has decreased their consumption of music downloads due to an increase in the price of music downloads, as evidenced by the movement along the budget constraint from point A to point B. This change in the price of music downloads causes the consumer to substitute towards movie downloads, as seen by the increase in consumption of movie downloads from point A to point B.

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