At Prices (P1, P2)= ($4, $1), George Buys the Bundle

question 5

Multiple Choice

At prices (p1, p2) = ($4, $1) , George buys the bundle (x₁, x₂) = (10, 20) .At prices (p'₁, p'₂) = ($1, $4) , he buys the bundle (x'₁, x'₂) = (4, 14) .At prices (p''₁, p''₂) , he buys the bundle (x''₁, x''₂) = (20, 10) .If his preferences satisfy the strong axiom of revealed preferences, then it must be that

• A)10p''₁ < 10p''₂.
• B)10p''₁ < 8p''₂.
• C)8p₁ > 8p₂.
• D)p''₁ = p''₂.
• E)None of the above.

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Definitions:

Economic Dominance

A situation where a company, product, or country has enough market power to influence market conditions or prices on a large scale.

Statutory Law

Laws and regulations enacted by legislative bodies at the federal, state, or local levels.

Judicial Precedent

A principle or rule established in a previous legal case that is binding or persuasive for a court when deciding subsequent cases with similar issues or facts.

Customs

The official department that administers and collects the duties levied by a government on imported goods, as well as the traditions and accepted practices within a society.