Author Question: Denise is shopping for lobsters and eclairs. When she faces budget line b1, she chooses market ... (Read 123 times)

P68T · **on:** Jul 1, 2018

Denise is shopping for lobsters and eclairs. When she faces budget line b1, she chooses market basket A over market basket B. When she faces budget line b2, she chooses basket B over basket C.

Which assumption of consumer theory helps us determine Denise's preference ordering over basket A and basket C? A) Completeness
B) More is better than less
C) Transitivity
D) Convexity

Question 2

Refer to Figure 9.2. At price 0E and quantity Q, consumer surplus is the area

A) 0FCQ.
B) AFC.
C) EFC.
D) AEC.
E) none of the above