We know that a certain consumer spends on two goods, one of which is salts and the other one is a composite good that is the rest of the money spent on everything other than good 1. Identify the type of preference, which describes the given case. Draw the appropriate income offer curve and Engel curve for variable income of the consumer and explain.
Marginal Rate of Technical Substitution
MRTS reaches a manufacturer when a part of the product is lowered to sustain the manufacturing level when the other part is extended. It is the level of the quantity that is lowered when one extra volume is used, and the output is unchanged.
Preferences and Utility Analysis
Before understanding what is preference and utility analysis, it is very important to understand the terms preference and utility separately.
We know that a certain consumer spends on two goods, one of which is salts and the other one is a composite good that is the rest of the money spent on everything other than good 1. Identify the type of preference, which describes the given case. Draw the appropriate income offer curve and Engel curve for variable income of the consumer and
explain.
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