Figure 21-13
-Refer to Figure 21-13. When the price of X is $40, the price of Y is $10, and the consumer's income is $80, the consumer's optimal choice is C. Then the price of X decreases to $10. We can derive the demand curve by determining the change in the quantity demanded illustrated by the movement from
A)C to E.
B)C to D.
C)D to E.
D)E to C.

Question

Figure 21-13 
-Refer to Figure 21-13. When the price of X is $40, the price of Y is $10, and the consumer's income is $80, the consumer's optimal choice is C. Then the price of X decreases to $10. We can derive the demand curve by determining the change in the quantity demanded illustrated by the movement from
A)C to E. 
B)C to D. 
C)D to E. 
D)E to C.

Quizplus · Accepted Answer

The movement from C to E illustrates the change in the quantity demanded of good X as its price decreases from $40 to $10, while keeping the consumer's income and the price of good Y constant. This shift represents the consumer's adjustment to the new price, moving along the indifference curve to a new optimal choice, which is used to derive the demand curve for good X.

Figure 21-13 -Refer to Figure 21-13. When the Price of X Is