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The Following Figure Shows a Portion of a Consumer's Indifference

Question 10

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The following figure shows a portion of a consumer's indifference map and budget lines.The price of good Y is $7 and the consumer's income is $700.Let the consumer begin in utility-maximizing equilibrium at point A on indifference curve I.Next the price of good X changes so that the consumer moves to a new utility-maximizing equilibrium at point B on indifference curve II.The substitution effect of the change in the price of X is The following figure shows a portion of a consumer's indifference map and budget lines.The price of good Y is $7 and the consumer's income is $700.Let the consumer begin in utility-maximizing equilibrium at point A on indifference curve I.Next the price of good X changes so that the consumer moves to a new utility-maximizing equilibrium at point B on indifference curve II.The substitution effect of the change in the price of X is   A) +12 B) +10 C) -10 D) +32 E) +42


A) +12
B) +10
C) -10
D) +32
E) +42

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