Suppose a Consumer Spends All Income on Goods X and Y

question 94

Multiple Choice

Suppose a consumer spends all income on goods X and Y. Suppose the price of good X increases and the consumer's income increases. Which of the following must be true?

• A) The amount of good X that the consumer can purchase increases.
• B) The amount of good Y that the consumer can purchase increases.
• C) Both A and B.
• D) None of the above.

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Definitions:

Percentage of Sales

A financial metric that shows how much of a company's sales are generated over a period, often used to allocate marketing budget.

Objective and Task

A method for budgeting advertising expenses based on defining specific objectives and the tasks required to achieve them.

Linear Forecast

A prediction model that assumes a straight-line (linear) relationship between the variable being forecasted and time, to project future values based on past data.

Extraversion

A personality dimension that involves the tendency to seek stimulation and enjoy the company of others, indicative of sociability and enthusiasm.