Q. 65.0( 2 Votes )

A consumer consum

Answer :

No, the consumer will not be in equilibrium because

MUx/Px <MUy/Py


This means: �< 4/4


The per rupee marginal utility of good X is lower than the per rupee marginal utility of good Y, the consumer will now buy less of good X and more of good Y.


This will continue till marginal utility of good X rises and the marginal utility of good Y enough so that:


MUx/Px = MUy/Py


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