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

Question

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

Accepted Answer

none of the above.

Answer

MU X /P X  > MU Y /P Y , and then Ron decreases his consumption of  X .

Answer

MU X /P X  > MU Y /P Y , and then Ron increases his consumption of  X .

Answer

MU X /P X  < MU Y /P Y , and then Ron decreases his consumption of  X .

Answer

MU X /P X  < MU Y /P Y , and then Ron increases his consumption of  X .

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