Get premium membership and access questions with answers, video lessons as well as revision papers.
Got a question or eager to learn? Discover limitless learning on WhatsApp now - Start Now!

Differentiate between the weak and the strong axioms of revealed preferences

      

Differentiate between the weak and the strong axioms of revealed preferences

  

Answers


Dana
The weak axiom of revealed bundle suggests that if a bundle (X1, X2) is directly revealed preferred to (Y1, Y2) and the two bundles are not the same then it cannot happen that (Y1,Y2) is directly revealed preferred to (X1,X2)
The strong axiom of revealed preferences requires that the same sort of condition hold for indirect revealed preference. The strong axiom states that if (X1, X2) is revealed preferred to (Y1, Y2) either directly or indirectly and (Y1, Y2) is different from (X1, X2) then (X1, X2) is revealed preferred to (Y1, Y2)

Dana05 answered the question on August 15, 2019 at 14:14


Next: Describe the behavior of the marginal rate of substitution for the various types of goods Perfect substitutes Neutral goods Perfect compliments Imperfect substitutes
Previous: The sum of the digits in three digit number is nine. The tens ten is digits half the sum of the other two and the...

View More Economics Questions and Answers | Return to Questions Index


Learn High School English on YouTube

Related Questions