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1. pallavi consumes only two goods. if only information we had about her is that she chooses 6,6 when prices are 6,3 and chooses the bundle 10,0 when prices are 5,5 then we conclude that:
a. neither bundle is revealed preferred to the other
b. the bundle 6,6 is revealed preferred to 10,0
c. she violates WARP
d. the bundle 10,0 is revealed preferred to 6,6 and she doesnt violate WARP
im confused between a and d,because she consumes 6,6 when the other is not affordable and same for the other bundle..so she doesnt violate WARP
2. a consumer's demand behavior is :
at p1,p2 = 1,1 she chooses x1,x2= 5,35
at p1,p2= 1,2 she chooses x1,x2= 35,10
then which is true:
a. her behavior violates WARP
b. her behavior satisfies WARP
c. data not enough to test WARP
d. the commodity bundles lie on same IC and are equilibrium points for different budget sets.
should it be b?
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