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Price of food rises by 10% and disposable income by 5%. “A man initially spending half his income on food would be neither better nor worse off as a result of these changes.” True or false?

2006-12-06 04:23:27 · 2 answers · asked by Anonymous in Social Science Economics

2 answers

If nothing else changes he would be better off. He could if he chose keep his consumption basket the same, but now he has other consumption baskets available that he may value more.
False

2006-12-06 06:51:50 · answer #1 · answered by meg 7 · 1 0

a weaker dollar.

2006-12-06 12:31:09 · answer #2 · answered by ranger12 4 · 0 0

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