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6. True/False; Explain briefly. (5 points each) a. If a consumer doesn't consume any snails, but does consume slugs, then his marginal rate of substitution

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6. True/False; Explain briefly. (5 points each) a. If a consumer doesn't consume any snails, but does consume slugs, then his marginal rate of substitution between snails and slugs when his snail consumption is zero must be equal to the ratio of the price of snails to the price of slugs. b. Xue's utility function is U(x, y) = xy. (This implies MUx = yz and MUy = 2xy .) Her marginal rate of substitution between x and y does not change if you double the amount she consumes of both goods. c. An inferior good is less durable than a normal good. d. Consumers should never spend any of their income on inferior goods. e. An increase in the price of a Giffen good makes consumers better off. f. Maria always maximizes her utility subject to her budget constraint. Prices changed and she was worse off than before. Therefore, at the old prices her new bundle must cost less than her old bundle

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