For M > P₂, the Demand Functions for Goods 1

question 42

Multiple Choice

For m > p₂, the demand functions for goods 1 and 2 are given by the equations, x₁ = m/p₂ - 1 and x₂ = p₁/p₂, where m is income and p₁ and p₂ are prices.Let the horizontal axis represent the quantity of good 1.Let p₁ = 1 and p₂ = 2.Then for m > 2, the income offer curve is

• A)a vertical line.
• B)a horizontal line.
• C)a straight line with slope 2.
• D)a straight line with a slope of 1/2.
• E)None of the above.

---

Definitions:

Publicly Owned

Refers to entities or businesses that are owned by the government or the public through publicly traded shares.

Inventory Costs

Expenses associated with holding and managing inventory, including storage, insurance, and loss of goods.

Equipment Costs

These are the expenses associated with purchasing or leasing machinery, tools, or other equipment required for the operation of a business or research activity.

Service Delivery

The process of providing services to customers or citizens, often evaluated by speed, quality, and customer satisfaction.