Consider the Marshallian (uncompensated) demand (Pz. Py, 1) = In case of a price increase for good x, in absolute terms, Sp.I O The compensating variation will be equal to the equivalent variation and equal to the change in the consumer surplus O The compensating variation will be greater than the equivalent variation and greater than the the change in the consumer surplus O The compensating variation will be greater than the equivalent variation but smaller than the the change in the consumer surplus O The compensating variation will be smaller than the equivalent variation and smaller than the the change in the consumer surplus O The compensating variation will be smaller than the equivalent variation but greater than the the change in the consumer surplus

Consider the Marshallian (uncompensated) demand (Pz. Py, 1) = In case of a price increase for good x, in absolute terms, Sp.I O The compensating variation will be equal to the equivalent variation and equal to the change in the consumer surplus O The compensating variation will be greater than the equivalent variation and greater than the the change in the consumer surplus O The compensating variation will be greater than the equivalent variation but smaller than the the change in the consumer surplus O The compensating variation will be smaller than the equivalent variation and smaller than the the change in the consumer surplus O The compensating variation will be smaller than the equivalent variation but greater than the the change in the consumer surplus

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter10: Cost Functions

Section: Chapter Questions

Problem 10.11P

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