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The graph shows Esther's best affordable point at A. Magazines (per month) 8.0- The price of seeing a movie rises and Esther's new best affordable
The graph shows Esther's best affordable point at A. Magazines (per month) 8.0- The price of seeing a movie rises and Esther's new best affordable point is C. Draw a budget line that isolates the substitution effect. Label it B3. Draw a point to indicate where Esther consumes if she faces the budget line you've drawn. Label it B. 6.0- 4.0- What is Esther's substitution effect and income effect? For Esther, the substitution effect is the movement from point and the income effect is the movement from point 2.0- ADD ALABEL O A. B to point C; C to point A 12 O B. C to point B; B to point A B2 35.98 B1 0.0- O C. A to point B; B to point C 0.0 2.0 4.0 6.0 8.0 Movies (per month) O D. A to point C; C to point B Edit coordinates (5.98,2.6) >>> Draw only the objects specified in the
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