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Suppose there are only two goods: Beer and Milk. Joses preference over bundles of beer and milk is as follows: for any two bundles A

Suppose there are only two goods: Beer and Milk. Joses preference over bundles of beer and milk is as follows: for any two bundles A = (bA, mA) and B = (bB, mB) (where b and m denotes the amount of beer and milk, respectively), A % B if and only if: Either: bA > bB; Or: bA = bB and mA mB. In other words, Jose cares first and foremost the amount of beer, but if the two bundles contain the same amount of beer, then he prefers having more milk to less.

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