question archive Assume the consumption of just two goods, X and Y
Assume the consumption of just two goods, X and Y
Subject:MarketingPrice:2.88 Bought3
Assume the consumption of just two goods, X and Y. Also, assume the consumer is in equilibrium. What do you think would happen to consumer equilibrium given each of the following changes?
A. income rises
B. price of both X and Y double
C. consumer now prefers more X and less Y
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What do you think would happen to consumer equilibrium given each of the following changes?
| Change in cirucumstance | Change in equilibrium | Reason for change |
| A. income rises | Demand shifts upward, equilibrium price rises | change in income |
| B. price of both X and Y double | equilibirum also rises by 2x | simultaneous changes in supply and demand |
| C. consumer now prefers more X and less Y | equilbrium shifts in favor of X | changes in tastes and prefereneces |
