Figure 21-7
-Refer to Figure 21-7. Suppose a consumer has $200 in income, the price of a book is $5, and the price of a DVD is $10. What is the value of A?
A)40
B)20
C)10

Question

Figure 21-7 
-Refer to Figure 21-7. Suppose a consumer has $200 in income, the price of a book is $5, and the price of a DVD is $10. What is the value of A?
A)40 
B)20 
C)10

Quizplus · Accepted Answer

To find point A, we need to determine the quantity of books and DVDs that the consumer can afford given their income and the prices of the goods.

With $200 in income, the consumer can afford:
- 40 books ($5 per book): 40 x $5 = $200
- 20 DVDs ($10 per DVD): 20 x $10 = $200

Therefore, point A represents a bundle of 40 books and 20 DVDs, which has a total value of:
Quantity of books (40) x Price of books ($5) + Quantity of DVDs (20) x Price of DVDs ($10) = $200

So, the value of A is 40.

Figure 21-7 -Refer to Figure 21-7. Suppose a Consumer Has $200 in Has