When prices are ($2, $4), Ms.Consumer chooses the bundle (7, 9), and when prices are ($15, $3), she chooses the bundle (10, 3).Is her behavior consistent with the weak axiom of revealed preference?
A)Yes.
B)No.
C)We would have to observe a third choice to be able to say.
D)We can't tell because we are not told her income in the two cases.
E)None of the above.

Question

Quizplus · Accepted Answer

The weak axiom of revealed preference states that if a bundle is chosen over another when both are affordable, then the chosen bundle should not be less preferred when the other bundle is affordable. Here, the first bundle (7, 9) is chosen when the second bundle (10, 3) is affordable at prices ($2, $4), but the second bundle is chosen when the first is affordable at prices ($15, $3), violating the axiom.

When Prices Are ($2, $4), Ms