Question

If the price of good X is $90 and the price of good Y is $30, it follows that the relative price of one unit of good Y is ___________ unit(s) of good X. Group of answer choices 0.33

Answer 1

Answer: 0.33

Explanation:

A relative price is defined as the price of a product when its compared with another product. It is the ratio of the prices of two goods. A relative price involves opportunity cost as economic agents usually choose a good at the expense of another after comparing a good with another.

Since the price of good X and Y are $90 and $30 respectively, then relative price of a unit of good Y in respect of good X

= 30/90 = 0.33