1.4. Fill in the blanks below with either "good X"

or "goodY," where good X is measured on the x-axis and good Y is measured on the y-axis.

a. If the price of __ is $8 and the price of __ is $12, then the price ratio (also the slope of the budget constraint) is 1.5.

b. A price ratio of 1.5 means that the consumer is able to trade 1 unit of __ for 1.5 units of--.

c. If another unit of __ would give a con sumer 20 extra units of utility, and another unit of __ would give a consumer 10 ex tra units of utility, then the marginal rate of substitution for this consumer is equal to 2.

d. A marginal rate of substitution of 2 means that, from the consumer's point of view, 1 more unit of __ is as good as 2 more units of __ .

e. If the price ratio is 1.5 and the marginal rate of substitution is 2, then the market values __ more than the consumer does, and the consumer values __ more than the market does. In this case, the consumer ought to buy less of __ and more of __ .