The Following Figure Shows a Portion of a Consumer's Indifference

question 10

Multiple Choice

The following figure shows a portion of a consumer's indifference map and budget lines.The price of good Y is $7 and the consumer's income is $700.Let the consumer begin in utility-maximizing equilibrium at point A on indifference curve I.Next the price of good X changes so that the consumer moves to a new utility-maximizing equilibrium at point B on indifference curve II.The substitution effect of the change in the price of X is

• A)+12
• B)+10
• C)-10
• D)+32
• E)+42

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