Consumer Behavior and Rational Choice
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In the following diagram, we show one of John's indifference curves and her budget line.
*Diagram Attached
A. If the price of good X is $100, what is her income?
B. what is the equation for her buedget line?
C. What is the slope of the budget line?
D. What is the price of good Y?
E. What is her marginal rate of substitution in equilibrium?
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Solution Summary
The expert examines the consumer behavior and rational choices.
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A. If the price of good X is $100, what is her income?
Income = 40X = 40*100 = $4000
B. what is the equation for her ...
Education
- BE, Bangalore University, India
- MS, University of Wisconsin-Madison
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