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Thomas spends his entire food budget on soup and pasta. His preferences are complete, transitive, monotonic, and convex. His income-consumption curve, with soup plotted on
Thomas spends his entire food budget on soup and pasta. His preferences are complete, transitive, monotonic, and convex. His income-consumption curve, with soup plotted on the x- axis and pasta on the y-axis, is a horizontal line. Suppose the price of soup decreases, all else constant. a. Create a chart to show the total, income, and substitution effects on soup and pasta of the decrease in the price of soup
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