Suppose a consumer has preferences over two goods, x and y , which are perfect s

Question

Suppose a consumer has preferences over two goods, x and y, which are perfect substitutes. In particular, two units of x is equivalent to one unit of y. If the price of x is $1, the price of y is $3, and the consumer has $30 of income to allocate to these two goods, how much of each good should the consumer purchase to maximize satisfaction?

Thirty units of x and zero units of y.

Zero units of x and ten units of y.

Fifteen units of x and five units of y.

Twelve units of x and six units of y.

Thirty units of x and zero units of y.

Zero units of x and ten units of y.

Fifteen units of x and five units of y.

Twelve units of x and six units of y.

Explanation / Answer

Thirty units of x and zero units of y

because, consumer can buy 30 unit of X from $30 but he have only buy 10 unit of Y in $30 which is equavalent to only 20 unit of X in terms of satisfaction, so to maximize sdatisfaction he should but all 30 unit of X as goods are perfectly substiiitute

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