This table contains prices and the demands of a consumer whose behavior was observed in 5 different price-income situations.

Situation	P1	P2	X1	X2
A	2	2	10	70
B	2	4	70	20
C	2	2	20	30
D	6	2	10	30
E	2	4	20	20

A. Sketch each of his budget lines and label the point chosen in each case by the letters A, B, C, D, and E.

B. Is the consumer’s behavior consistent with WARP? Explain.

C. Shade all of the points that you are certain are worse than bundle C.

D. Suppose that you are told that the consumer has convex and monotonic preferences and that he obeys SARP. Shade the points that are at least as good as bundle C.

PLEASE SHOW ALL WORK, NO EXCEL, THANK YOU!

Answer rating: 100% (QA)

As per the question we have different PriceIncome situation from A to E which shows the p... View the full answer