At prices (p₁, p₂)= ($4, $2), Ivan buys the bundle (x₁, x₂)= (8, 20).At prices (p'₁, p'₂)= ($2, $4), he buys the bundle (x'₁, x'₂)= (10, 13).At prices (p''₁, p''₂), he buys the bundle (x''₁, x''₂)= (14, 11).If his preferences satisfy the strong axiom of revealed preferences, then it must be that A)8p₁ 2p₂. B)6p''₁

Question

At prices (p₁, p₂)= ($4, $2), Ivan buys the bundle (x₁, x₂)= (8, 20).At prices (p'₁, p'₂)= ($2, $4), he buys the bundle (x'₁, x'₂)= (10, 13).At prices (p''₁, p''₂), he buys the bundle (x''₁, x''₂)= (14, 11).If his preferences satisfy the strong axiom of revealed preferences, then it must be that A)8p₁ > 2p₂. B)6p''₁ < 9p''₂. C)6p''₁ <8p''₂. D)p''₁ = p''₂. E)None of the above.

Quizplus · Accepted Answer

The Answer of At prices (p₁, p₂)= ($4, $2), Ivan buys the bundle (x₁, x₂)= (8, 20).At prices (p'₁, p'₂)= ($2, $4), he buys the bundle (x'₁, x'₂)= (10, 13).At prices (p''₁, p''₂), he buys the bundle (x''₁, x''₂)= (14, 11).If his preferences satisfy the strong axiom of revealed preferences, then it must be that A)8p₁ > 2p₂. B)6p''₁ < 9p''₂. C)6p''₁ <8p''₂. D)p''₁ = p''₂. E)None of the above.

At Prices (P1, P2)= ($4, $2), Ivan Buys the Bundle

At Prices (P₁, P₂)= ($4, $2), Ivan Buys the Bundle