A Consumer Has Preferences Over Two Goods, X and Y

question 423

Multiple Choice

A consumer has preferences over two goods, X and Y. Suppose we graph this consumer's preferences (which satisfy the usual properties of indifference curves) and budget constraint on a diagram with X on the horizontal axis and Y on the vertical axis. At the consumer's current consumption bundle, the consumer is spending all available income, and the marginal rate of substitution is less than the slope of the budget constraint. We can conclude that the consumer

• A)is currently maximizing satisfaction subject to the budget constraint.
• B)could increase satisfaction by consuming more X and less Y.
• C)could increase satisfaction by consuming less X and more Y.
• D)could purchase more X and more Y and increase total satisfaction.

---

Definitions:

Respiratory Acidosis

A condition where the lungs cannot remove enough carbon dioxide produced by the body, leading to a disturbance in the body's acid-base balance.

Carbon Dioxide Retention

A condition in which the lungs are unable to effectively expel carbon dioxide, leading to increased levels in the blood.

Cardiac Output

The volume of blood the heart pumps through the circulatory system in one minute, an important measure of heart function.

Gastric Acid

A highly acidic solution produced by the glands in the stomach, essential for digestion and killing ingested pathogens.