Question

A consumer has $300 to spend on goods x and y. The market prices of these two goods are px = $15 and py = $5. What is the maximum quantity of good x that the consumer can purchase?

Answer 1

The consumer can purchase a maximum of 20 units of good x with their $300 budget, given the price of $15 per unit of good x.

Step-by-step explanation:

The maximum quantity of good x that the consumer can purchase is found by dividing the consumer's budget by the price of good x. With a budget of $300 and the price of good x being $15, the consumer can purchase a maximum of 20 units of good x. This calculation is straightforward: total budget ($300) / price of good x ($15) = maximum quantity of good x (20).