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Could someone please help me with this question. Note: Assume that they have well-behaved preferences in that their indifference curves are strictly convex. Consider the
Could someone please help me with this question.
Note:
Assume that they have well-behaved preferences in that their indifference curves are strictly convex.
Consider the figure below where the black line represents the consumer's initial budget line and the red line represents the consumer's new budget line following a change in the prices and/or income.
Assume that the consumer has a relatively strong preference for music and that price per unit of movies is lower at the red budget line relative to the black one.
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