Multiple Choice
If Bernice (whose utility function is min{x, y}, where x is her consumption of earrings and y is money left for other stuff) had an income of $15 and was paying a price of $8 for a pair of earrings, then if the price of earrings went up to $13, the equivalent variation of the price change would be
A) $5.36.
B) $8.33.
C) $16.67.
D) $2.68.
E) $6.85.
Correct Answer:
Verified
Correct Answer:
Verified
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