Question
Sue views hot dogs and hot dog buns as perfect complements in her consumption, and the corners of her indifference curves follow the 45-degree line.
Sue views hot dogs and hot dog buns as perfect complements in her consumption, and the corners of her indifference curves follow the 45-degree line. Initially, the price of hot dogs is $3 per package, the price of buns is $3 per package, and Sue's budget is $48 per month. How does her optimal consumption bundle change if the price of hot dog buns increases to $5 per package? A) Sue does not change her consumption because these goods are perfect complements. B) She buys the same amount of hot dog buns and buys more hot dogs. C) She buys the same amount of hot dogs and buys two less packages of hot dog buns. D) She reduces her consumption by 2 packages of hot dogs and 2 packages of hot dog buns.
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