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Suppose Ian Consumes Bread and Mustard with His Income

question 79

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Suppose Ian consumes bread and mustard with his income.He views these goods to be Perfect Complements.He currently consumes 15 units of each good each week.Suppose that the price of Mustard increases by $1/unit and bread increases by $2/unit.Ian's union automatically provides him with a CPI adjustment in his income amounting to an increase by $45.Is Ian better off,worse off,the same or is it uncertain as compared to previously? Explain and provide a graph to demonstrate your answer.


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