An Agent Consumes Goods X and Y, with Prices P_x

question 29

Multiple Choice

An agent consumes goods x and y, with prices P_x = $5 per unit and P_y = $8 per unit. The consumer's income is I = $48. The government imposes a tax of $1 per unit on good x. What is the new equation for the budget constraint?

• A) y = 6 - (5/8)x
• B) y = 6 - .75x
• C) y = 8 - (6/8)x
• D) y = 48 - 8x

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Definitions:

Exhaustion Stage

The final stage of the General Adaptation Syndrome, characterized by depleted physical and mental resources after prolonged exposure to stress.

Locus Of Control

The place (locus) to which an individual attributes control over the receiving of reinforcers—either inside or outside the self.

Reinforcers

Stimuli that increase the probability of a behavior being repeated, can be positive (adding a desirable stimulus) or negative (removing an undesirable stimulus).

Irrational Beliefs

Thoughts or convictions that are not based on reason or logic, often leading to emotional distress or unproductive behaviors.