A consumer has ?100 of income to spend on goods X and Y. The price
A consumer has ?100 of income to spend on goods X and Y. The price of good X is ?10, and the price of good Y is ?2. Which of the following combinations of X, and Y is not affordable?
- A) 10X and 0Y
- B) 6X and 25Y
- C) 4X and 20Y
- D) 5X and 25Y
Correct Answer: B) 6X and 25Y
Explanation
This question is about a consumer who has ?100 of income to spend on two goods, X and Y. The price of good X is ?10, and the price of good Y is ?2. The question asks which of the following combinations of X and Y is not affordable with ?100.
Option A is 10X and 0Y. This means the consumer spends all their ?100 on good X and none on good Y. Since the price of X is ?10, the consumer can buy 10 units of X with ?100. This combination is affordable.
Option B is 6X and 25Y. This means the consumer spends ?60 on good X and ?50 on good Y. The cost of 6 units of X is ?60 (6 x ?10), and the cost of 25 units of Y is ?50 (25 x ?2). The total cost of this combination is ?110, which is more than the ?100 income the consumer has. Therefore, this combination is not affordable, and it is the correct answer.
Option C is 4X and 20Y. This means the consumer spends ?40 on good X and ?40 on good Y. The cost of 4 units of X is ?40 (4 x ?10), and the cost of 20 units of Y is ?40 (20 x ?2). The total cost of this combination is ?80, which is less than the ?100 income the consumer has. Therefore, this combination is affordable.
Option D is 5X and 25Y. This means the consumer spends ?50 on good X and ?50 on good Y. The cost of 5 units of X is ?50 (5 x ?10), and the cost of 25 units of Y is ?50 (25 x ?2). The total cost of this combination is ?100, which is equal to the ?100 income the consumer has. Therefore, this combination is also affordable.
In summary, the correct answer is Option B because the total cost of 6X and 25Y is more than the ?100 income the consumer has. This question tests the student's understanding of the concept of affordability based on the prices of goods and the consumer's income.

