A Consumer Currently Spends a Given Budget on Two Goods

question 29

Multiple Choice

A consumer currently spends a given budget on two goods, X and Y, in such quantities that the marginal utility of X is 10 and the marginal utility of Y is 8. The unit price of X is $5 and the unit price of Y is $2. The utility-maximizing rule suggests that this consumer should

• A)increase consumption of product X and decrease consumption of product Y.
• B)increase consumption of product X and increase consumption of product Y.
• C)increase consumption of product Y and decrease consumption of product X.
• D)stick with the current consumption mix because it yields maximum utility.

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Definitions:

Unions

Organizations formed by workers in various industries to protect and promote their rights, interests, and working conditions.

Political Parties

Organizations that seek to gain power in a government, usually by participating in electoral campaigns and presenting candidates for public office.

Repatriation

The process of returning an expatriate employee back to their home country after completing an international assignment, which involves adjustment and reintegration into their home office and culture.

International Assignment

A work task or role that is performed in a country different from the employee's home country, often involving relocation for a defined period.