Question

Suppose bundle A contains 5 CDs and 5 DVDs and bundle B contains 2 CDs and 6 DVDs. If a consumer is able to rank different combinations of goods and services in terms of how much utility they provide, then

A) the consumer will prefer bundle B to bundle.
B) the consumer will prefer bundle A to bundle.
C) the consumer will be indifferent between bundle A and bundle B.
D) both a and b are possible.
E) a, b, and c are possible.

Answer 1

E) a, b, and c are possible.

Step-by-step explanation:

Consumer has different interests, thus they may prefer either Bundle A with same volume of CD or DVDs or bundle B with more DVDs or even neither of any.