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Ron Starts Out in Consumer Equilibrium, Consuming Two Goods, X

Question 78

Multiple Choice

Ron starts out in consumer equilibrium, consuming two goods, X and Y. Ron's income rises. At this point, we can definitely conclude that


A) MUX/PX > MUY/PY, and then Ron increases his consumption of X.
B) MUX/PX > MUY/PY, and then Ron decreases his consumption of X.
C) MUX/PX < MUY/PY, and then Ron increases his consumption of X.
D) MUX/PX < MUY/PY, and then Ron decreases his consumption of X.
E) none of the above.

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