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A professor preferences for cups of orange juice (x1) and cups of coffee (x2) are consistent with the utility functionU(x1,x2)=min(x1,x2).Suppose that the price for a
A professor preferences for cups of orange juice (x1) and cups of coffee (x2) are consistent with the utility functionU(x1,x2)=min(x1,x2).Suppose that the price for a cup of orange juice starts at p1 = 1 dollar ,the price for a cup of coffee starts at P2= 2 dollars,and his income is m = 120 dollars. If the price of a cup of orange juice increases to 2 , what are the changes in the quantity of cups of orange juice due to the substitution and income effects? a.(SE,IE)=(1,-12) b.(SE,IE)=(0,-11)
c.(SE,IE)=(1,-11) d.(SE,IE)=(0,-10)
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