Jim 's utility function is U(q 1 , q 2 ) min(q 1 , q 2 ) The price of each good is $1, and his monthly income is $4,000 His firm wants him to relocate to another city where the price of q 2 is $2, but the price of q 1 and his income remain constant Obviously, Jim would be worse off due to the move What would be his equivalent variation or compensating variation

Question: Jim's utility function is U(q 1 , q 2 ) = min(q 1 , q 2 ). The price of each good is $1, and

Jim's utility function is U(q₁, q₂) = min(q₁, q₂). The price of each good is $1, and his monthly income is $4,000. His firm wants him to relocate to another city where the price of q₂ is $2, but the price of q₁ and his income remain constant. Obviously, Jim would be worse off due to the move. What would be his equivalent variation or compensating variation?

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