A consumer consumes two goods, good X and good Y. Prices of the two goods are Px and Py respectively. Explain how consumer reaches equilibrium in the consumption of two goods.

Explanation:

In the case of two goods, a consumer's equilibrium is attained at the point when the utility gotten from each additional unit or money spent on each of the goods are equal. That is, Marginal Utility of a dollar spent on the good x that is, MUx/Px equals to the marginal utility of dollar spent on good Y i.e MUy = Py which is also equal to the marginal utility of money.

In such a case when either the marginal utility of x or y is different, the consumer will rearrange his consumption combination till the equality is restored again.

if you use only 25 for your entertainment and only 200 for the groceries that you really need and take out the 50 per month for the computer then that should be enough

answer; foreign exchange transaction;