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This post was updated on .
If an individual prefers X to Y and exhausts all his income, can we conclude px>py?
Te idea of revealed preference says
px(1) + py(0) >px(0)+py(1)
Or px>py
This doesn't make rational sense, one does not necessarily prefer costly goods over cheaper goods.
Where am I going wrong?
Edit: I've sorted my misunderstanding.
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