For Any Two Goods, X and Y, If MU_X Divided

question 248

Multiple Choice

For any two goods, X and Y, if MU_X divided by P_X equals 2.5 and MU_Y divided by P_Y equals 4.0, then with given income and prices the consumer should

• A) buy more of good X and less of good Y.
• B) buy more of good Y and less of good X.
• C) buy all of good Y and no X.
• D) stop because an equilibrium is achieved.

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Definitions:

Eustress

Positive stress that can have beneficial effects on health, motivation, performance, and emotional well-being, unlike distress.

Positive Response

A favorable reaction or reply to stimuli, information, or an action.

Generates Energy

The ability of a person, process, or environment to inspire and stimulate physical or mental activity.

Social Exchange Process

A theory that explains social change and stability as a process of negotiated exchanges between parties.