Multiple Choice
Suppose that a consumer has utility U(X,Y) = 2XY + X and income of $499 to spend on goods X and Y. The initial prices of X and Y are $1 and $2 per unit, respectively. Suppose the price of good X increases to $2 per unit. The total effect on the consumption of goods X and Y is ____ for good X and ____ for good Y.
A) 125; 0
B) -125; 0
C) 0; 125
D) 0; -125
Correct Answer:
Verified
Correct Answer:
Verified
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