Question: A consumer is in equilibrium at point A in the following figure. The price of item X is $ 5 a. What is the price

A consumer is in equilibrium at point A in the following figure. The price of item X is $ 5
a. What is the price of item Y?
b. What is consumer income?
c. At point A, how many units of X are consumers buying?
d. Suppose the budget line changes so that consumers reach a new equilibrium point at B. What changes in the economic environment are causing this new equilibrium? Are consumers getting better or worse from these price changes? Product Y 40 25 20 10 Product X 20

Product Y 40 25 20 10 B A 20 Product X

Step by Step Solution

★★★★★

3.38 Rating (148 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

To solve the questions lets analyze the graph and information provided a What is the price of item Y 1 Identify the budget line equation The budget li... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!

Kofi Allon, who is 32 years old and single, is employed as a technical consultant for a large electronics distributor. He lives at 678 Birch Street, LaMesa, CA 91941. Kofi's Social Security number is...

A consumer is in equilibrium at point A in the accompanying figure. The price of good X is $5.a. What is the price of good Y?b. What is the consumer??s income?c. At point A, how many units of good X...

Suppose the U.S. economy is in equilibrium at the long-run real interest rate that prevails when aggregate expenditures equal potential output. Draw a diagram of aggregate expenditures showing this...

Suppose that the loanable fund market is in equilibrium at real interest rate r1. The government then decides to spend more, increasing the budget deficit. The new supply curve (S2) is shown in the...

1. A consumer has $300 to spend on goods X and Y. The market prices of these two goods are Px = $15 and Py = $5. a. What is the market rate of substitution between goods X and Y? b. Illustrate the...

A consumer is in equilibrium at point A in the accompanying figure. The price of good X is $5. a. What is the price of good Y? b. What is the consumer's income? c. At point A, how many units of good...

2. A consumer is in equilibrium at point A in the accompanying figure. The price of good X is $5. (LO2, LO3) a. What is the price of good Y? b. What is the consumers income? c. At point A, how many...

Review the consolidated balance sheets and the related disclosures and respond to the following questions. Debt: As of June 30, 2015, what is the dollar amount of the current portion of the long-term...

Based on chapters 3 & 6 of this module, your Reflection paper should contain 400 words or more. explain what you learned in the corresponding module using your own words. chapter 3 Why Can We Not Get...

Exercise. The short-run aggregate supply curve may shift to the left if: a inflationary expectations increase. b productivity increases. c government spending increases. d personal income taxes...

2 a) Given utility function U (C; R) = min (C; 2R); daily endowment of time 24h, price and wage pc= w = 1; nd optimal choice of C; relaxation time R and labor supply L. (three numbers, use secrets of...

A gymnast is performing a giant swing on the high bar. In a simplified model of the giant swing, assume that the gymnast keeps his arms and body straight as he swings all the way around the upper...

Firm A is considering the acquisition of Firm B. For Firm A, PV = $2,000 and N = 100. For Firm B, PV = $1,000 and N = 50. Proforma financial information for Firm AB is below; the appropriate discount...

Stimulus codability is: Group of answer choices another name for product positioning. a form of brand name. consensually held meanings among customers. the perception that the brand is known.

vii. Silver metal obey Dulong-petit law at room temperature but diamond does not xplain What do you know about point group and space group symmetries? Give characteristics of space group ix.

Tube A B Problem 2. A solid steel bar of diameter d, enclosed by a steel tube of outer diameter dz = 3 in. and inner diameter d2 2 in. is %D Bar = 2.5 in. Both bar and tube are held rigidly by a...

Perform the complete catabolism of two moles of raffinose taking into account the conditions: You can use the enzyme galactosidase, in addition to the enzymes involved in the metabolism of galactose,...

Problem 1. A rectangular bar of length L has a slot in the middle half of its length. The bar has width b, thickness t, and modulus of elasticity E. The slot has width b/3. 3. 4. L (a) Obtain a...

Why is a solution of potassium hydroxide used to absorb carbon dioxide evolved during the estimation of carbon present in an organic compound? An organic compound contains 69% carbin and 4.8%...

an ____ indistry is one that is characterized by many small firms, a commodity product, and little to no cability for each firm to raise its prices

The price of vanilla beans has been bouncing around a lot. The price was $50 per kilogram (2.2 pounds) in 2000, then rose to $500 in 2003, then dropped to $25 in 2006. We can use the model of demand...

Refer to Figure. Suppose demand is Q = 10,000 1,000P and marginal cost is constant at MC = 6. From the given demand curve, one can compute the following marginal revenue curve: MR = 10 Q/500 a. Graph...

1. Fashion and Prices. You are in the market for a used car and have narrowed your options to two types of cars, type F and type P. According to Consumer Reports, the two types of cars have roughly...

Your store sells an item desired by a consumer. The consumer is using an optimal search strategy; the accompanying graph shows the consumer??s expected benefits and costs of searching for a lower...

Case introducing earnings-per-share calculations for a complex capital structure. The Layton Ball Corporation has a relatively complicated capital structure that is, it raises funds using various...

Gary Kifer, an auditor with Neely CPAs, is performing a review of Dudley Companys inventory account. Dudley did not have a good year, and top management is under pressure to boost reported income....