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MrsAngelD MrsAngelD
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6 years ago
Suppose a consumer purchases Food (F) and other goods (X) with their income of $100. For simplicity, suppose that food and other goods are measured in $1 units, so the price of each is $1. Currently, the consumer can purchase unlimited food stamps by paying 10¢ for $1 of food. With this, the consumer purchases 500 food stamps (for 500 units of food) and 50 units of X. As a result, the government must pay 90¢ towards food, for a total cost of $450. Using a graph of budget constraints and indifference curves, show that the consumer prefers to receive a cash gift of $450 over the food stamp option.
Textbook 
Microeconomics: Theory and Applications with Calculus

Microeconomics: Theory and Applications with Calculus


Edition: 4th
Author:
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RumkoRumko
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6 years ago
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MrsAngelD Author
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6 years ago
Helped a lot
Ifekwunigwe
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Yesterday
Correct Slight Smile TY
mmmm_dat_userna
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2 hours ago
Thanks for your help!!
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