SUNY Buffalo State College - MGE 301

Chapter 4

1)If the prices of BOTH good X and good Y double, what is the effect on the budget line?

2. When income is constant and the price of good X, Px, increases (or decreases), what is the effect on the budget line?

3. Moving along an indifference curve from one bundle to another, a consumer gains 1 unit of X and gives up 3 units of Y.

4. Which of the following can represent all affordable goods and services?

5. Workers’ behavior can be analyzed using which of the following?

6. Since workers substitute between leisure and income, what must firms do to induce workers to give up leisure?