For the following situation argue 1) whether the WARP is violated or not. and 2)
ID: 1183757 • Letter: F
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For the following situation argue 1) whether the WARP is violated or not. and 2) which (if any) bundle is revealed preferred to the other one. Assume that Susan has an income of 53. Susan can consume 4 goods: liquid paper, timbits, french fries, and cola. On day one Susan faces prices pl1 = 2, pt1 = 1, pf1 = 4 and pc1= 1. She consumes xl1 = 4, xt1 = 8, xf1 = 8, and xc1 = 5. On day two she faces prices pl2 = 0.5, pt2 = 0.8, pf2 = 6 and = 0.5, and pc2 = 0.5, and consumes xl2 = 4, xt2 = 5, xf2= 9, and xc2 = 4.Explanation / Answer
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