A household can buy and only. . In situation A and B behave as follows:
| Situation | Income | purchased | |
|---|---|---|---|
| A | 40 | 1 | 20 |
| B | 61 | 2 | 15 |
Is the consumer consistent?
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UoH 2016 Question 86: Consumer preferences and utility
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Plain-text version
A household can buy X₁ and X₂ only. P₂ = 1. In situation A and B behave as follows: | Situation | Income | P₁ | X₁ purchased | A | 40 | 1 | 20 | B | 61 | 2 | 15 | Is the consumer consistent? (A) No (B) Yes (C) Need more information (D) May be
Also written as: A household can buy X_1 and X_2 only. P_2 = 1. In situation A and B behave as follows: | Situation | Income | P_1 | X_1 purchased | A | 40 | 1 | 20 | B | 61 | 2 | 15 | Is the consumer consistent?
Consumer preferences and utility has come up 93 times in 7 exams since 2007.
What this question tests
This question is on Revealed preference, part of Consumer preferences and utility in Microeconomics.
Inferring preferences from observed choices: the weak and strong axioms of revealed preference and consistency checks.
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