Question

Last​ year, the price of hamburger was ​$5 per pound and the price of trout was ​$6 per pound.       This​ year, the price of hamburger is ​$8 per pound and the price of trout is ​$9 per pound.   All other things​ equal, and assuming that Phillip purchased both items​ before, what would you expect to happen to his purchases of hamburger ​(relative to trout​) this​ year?

Answer 1

Answer: The relative Price of Hamburger has decreased, so Phillip would be expected to purchase more.

Step-by-step explanation:

Given that,

Price of Hamburger(H):

Last year = $5 per pound

This year = ​$8 per pound

Price of trout(T):

Last year = $6 per pound

This year = ​$9 per pound

Last year's Relative price of Hamburger =
`(H)/(T)`

=
`(5)/(6)`

= 0.833

This year's Relative price of Hamburger =
`(H)/(T)`

=
`(8)/(9)`

= 0.888

The relative Price of Hamburger has decreased, so Phillip would be expected to purchase more.