Consumer purchases combination of two commodities

Assignment Help Business Economics

Reference no: EM13896846

Suppose a consumer purchases a combination of two commodities that is on his or her budget line but the budget line is not tangent to an indifference curve at that point. Of which commodity should the consumer buy more of and of which should he or she buy less? Why? (use a graph too if you think it will help)

Reference no: EM13896846

Questions Cloud

What types of assets might a small business have : What types of assets might a small business have? What types of debts (liabilities) might a small business have? What does a current ratio measure, and how do you calculate it?

How will you manage the potential conflict? : How will you manage the potential conflict?

Were encouraged by changing social role of their product : In the 1990s, U.S. wine producers "were encouraged by the changing social role of their product." Specifically, the U.S. consumer had become much more attuned to wine. How did the growing acceptance of wine by consumers affect their indifference curv..

Explain how each of events will affect the budget line : Explain how each of the following events will affect the budget line. (use a graph too if you think it will help)

Consumer purchases combination of two commodities : Suppose a consumer purchases a combination of two commodities that is on his or her budget line but the budget line is not tangent to an indifference curve at that point. Of which commodity should the consumer buy more of and of which should he or sh..

What kinds of drugs are most commonly used : What kinds of drugs are most commonly used in your community? Who is eligible for the programs? What services do the programs offer

Discuss economic and ethical aspects of safety regulations : Discuss economic and ethical aspects of safety regulations. THE discussion on the chapter 3 “Flying the Friendly Skies” in the economics of public issues 18 edition .With examples of when there may be a conflict between an ethical and an economic/mar..

Explain why the budget line can be called objective : Explain why the budget line can be called "objective" but an indifference curve is called "subjective." Explain why, if a consumer is to be in equilibrium, the marginal rate of substitution of good X for good Y must equal the negative ratio of the pr..

What is meant by a hierarchy of strategy? : What is meant by a hierarchy of strategy?

User Account

All Pages