True false part ii short

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Unformatted text preview: rmines whether good X or good Y are consumed. TRUE FALSE 8. If Kumar’s Willingness- to- pay for burgers is higher than Harold’s at any price, his consumer’s surplus from consuming burgers is lower than Harold’s. TRUE FALSE 9. Quasi- linear preferences imply that the consumption of only one good depends on income. TRUE FALSE 10. If the income- consumption curve is back- ward bending, the corresponding Engel curve must be back- ward bending as well. TRUE FALSE PART II – SHORT ANSWER QUESTIONS 1. What is the ECONOMIC meaning of the equality MUx/px = MUy/py? Explain when it might not be valid (HINT: “marginal utility of X over the price of x equals marginal utility of Y over the price of Y” IS NOT THE ANSWER) (5 points) The last dollar spent on either good, gives the...
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