Utility, Substitution and Demand

5: Try it out (2) Change of Price

In the previous exercise, the optimum was 5 packets of crisps, 4 packets of nachos.

Now let's try the exercise again, but with the price of a packet of nachos changed from 62 to 67 pence. The other parts of the model are kept constant, including the five pound total budget and the price of crisps at 50 pence. Again, it is your turn to be a rational consumer and find the choice that maximises total utility.