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Unformatted text preview: For every extra 4 dollars I have, I will consume 1 extra unit of X: • Remember, anytime you have a constant for the marginal rate of substitution (slope of the indifference curve), you have perfect substitutes DOES NOT have to be (1)! • Remember, with perfect substitutes, the change in the quantity demanded of one of the goods (either X or Y) is ALL due to either: the substitution effect OR the income effect. • With the perfect complements, the change in the quantity demanded of one of the goods (either X or Y) is ALL due to the income effect NO PROBLEMS DUE WED....
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 Spring '09
 Nonnenmacher
 Microeconomics, Engel, inverse demand, inverse demand curve, 4 dollars

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