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X America Before Colun x C Infinite Campus es-finance-domain/microeconomics/supply-demand-equilibrium/demand-curve-tut.. G C Demand and the law of demand Jeff is a rational consumer who spends his entire income on food and vacations. The table below descri his marginal utility and the prices of food and vacations. Price of food MU Price of vacations MUvacations $5 20 $500 2,000 If the price of a vacation decreases to $300, which of the following best describes the income effect of price change? Choose 1 answer: A The marginal utility per dollar spent on vacations is lower, so he will increase how many vacations he purchases. B The price of a vacation relative to food has decreased, so he will buy more vacations. C food, or both. He now effectively has more disposable income, which he can spend on more vacations, moreDemand and the law of demand hoose 1 answer The marginal utility per dollar spent on vacationin lower so he will increase how many vacations he purchases. B The price of a vacation relative to food has decreased so he will bary more vacation? He now effectively hun more dipoutde Income, which he can spend on more vacations, more C food, or both He will purchase more of both goods thicause his total income has increased O He will purchase less food because the marginal utility per dollar spent on food has decreased, -import a problem Get 5 of 7 questions to level up to Famillar ( 0 0 0 0 0 0 DELL O $ % & 5 8 r U O