Question on: JAMB Economics - 2012
A
consumption of X and reduce the consumption of Y
B
expenditure on Y
C
expenditure on X
D
consumption of Y and reduce the consumption of X
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Correct Option: C
The movement from point M to K on the indifference curve represents a change in the consumer's consumption bundle.
- At point M, the consumer is consuming a certain amount of good X and a certain amount of good Y.
- At point K, the consumer is consuming more of good Y and less of good X, because K is located on the right side of M (Y axis) and below M (X axis).
Therefore, to move from point M to K, the consumer has to decrease the consumption of X and increase the consumption of Y.
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