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A consumer is observed making two choices. First, he faces prices p = (1,3) with wealth w = 8 but is limited to purchasing no
A consumer is observed making two choices. First, he faces prices p = (1,3) with wealth w = 8 but is limited to purchasing no more than 3 units of good 1. Given this budget set, he chooses the bundle a = (2, 2). Second, he faces prices p' = (2, 1) and wealth w' = 8 with no limit on his purchases of either good. Given this budget set, he chooses the bundle r' = (4, 0). identify all revealed preferences given these choices. Do this consumer's choices satisfy the Weak Axiom of Revealed Preference? Could these choices result from the consumer choosing optimally given some mono- tone, convex, and continuous preferences? Explain your answer carefully; you do not have to provide a formal proof
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