Assume a Consumer Is Currently Purchasing a Combination of Goods

question 32

Multiple Choice

Assume a consumer is currently purchasing a combination of goods, X and Y, that maximizes her utility given her budget constraint, i.e., MRS_X,Y = P_X/P_Y. Now assume that there is a decrease in the price of Y. In this case, to once again maximize her utility, the consumer will want to adjust her purchases of X and Y such that:

• A) the marginal rate of substitution of X for Y, i.e., MRS_X,Y, decreases.
• B) the marginal rate of substitution of X for Y, i.e., MRS_X,Y, stays the same.
• C) the marginal rate of substitution of X for Y, i.e., MRS_X,Y, increases.
• D) none of the above. The consumer will continue to maximize her utility after the price change by continuing to consume the same combination of X and Y.

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Definitions:

Bone Loss

The reduction in bone density and mass, often associated with aging or certain medical conditions, leading to weakened bones.

Women

Adult human females, often discussed in contexts involving gender-specific issues in society, biology, and health.

Bone Density

The measurement of the amount of bone mineral contained in a certain volume of bone, reflecting its strength and health.

Vitamin D

A fat-soluble vitamin essential for bone health and immune system function, primarily obtained through sunlight exposure and dietary intake.