Unformatted text preview: As long as their M v x was less than .95y, they would purchase more x, and move away from their original bundle price, in essence they would be “better off”. The consumer who apportioned her income 50/50 between X and Y will gain, as her cost of living only went up by $750, but she was compensated for $850. The typical consumer would break even, and the person who apportioned 20x and 80y, would lose, since she lost $900 to inflation and she was only compensated for $850....
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- Spring '11
- Economics, English-language films, $900, $750, 7.5%, $850