Question

8 Graphi 12 13 Beer (Bottles) 2 0 Candy (Packages) 2 6 8 P 2.00 P 2.00 2.00 2.00 1.33 1.00 1.33 1.00 1.00 1.33 1.00 d 0 1 2 3 4 Beer (A) 0 1 2 3 4 Beer (B) 0 1 2 3 4 Beer (C) 0 1 2 3 4 Beer (D) Graph I above shows E.T.'s equilibrium combinations of beer and candy for three different prices of beer. (11, 12, and 13 are indifference curves. The price of a package of candy is constant at $1.00.) Letting Pc represent the price of beer, which demand curve (d) above is consistent with graph I?

Graph I above shows E.T.'s equilibrium combinations of beer and candy for three different prices of beer. (I₁, I₂, and I₃ are indifference curves. The price of a package of candy is constant at $1.00.) Letting P_C represent the price of beer, which demand curve (d) above is consistent with graph I?

Answer 1

Answer is = Graph C.

Prices of beer are $2, $1.33 and $1 and demand curve is downward sloping which is represented by graph C.

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