<p>When she chooses the bundle (6,6) when the prices are (6,7), she spends 
\begin{equation*}
6*6+6*7=78
\end{equation*}
The total price of the bundle (10,0) given this price system is 
\begin{equation*}
10*6+0*7=60&lt;78
\end{equation*}
Therefore she could afford the bundle (10,0) if she wanted to. The fact that she chooses (6,6) reveals that she prefers (6,6) to (10,0).</p>

<p>Given the price system (5,5), when she chooses the bundle (10,0) she spends
\begin{equation*}
10*5+0*5=50
\end{equation*}
And the price of the bundle (6,6) would be
\begin{equation*}
6*5+6*5=60
\end{equation*}
Therefore (6,6) is not necessarily affordable if her budget is comprised between 50 and 59. This is why (10,0) is not revealed preferred to (6,6) in that case, and thus there is no evidence that she violates WARP.</p>

CC BY-SA 3.0
2016-01-17T22:22:09.260Z
Current stats for this question: 2 views, 1 answer and 1 vote to close :)
Giskard
CC BY-SA 3.0
2016-01-17T22:11:32.167Z
2016-01-17T22:11:32.167Z
Oliv
<p>If the only information we had about Goldie were that she chooses the bundle (6, 6) when prices are (6, 7) and she chooses the bundle (10, 0) when prices are (5, 5), then we could conclude that</p>

<p>a.
the bundle (6, 6) is revealed preferred to (10, 0) but there is no evidence that she violates WARP.</p>

<p>b.
Goldie violates WARP.</p>

<p>c.
the bundle (10, 0) is revealed preferred to (6, 6) and she violates WARP.</p>

<p>d.
neither bundle is revealed preferred to the other.</p>

<p>e.
the bundle (10, 0) is revealed preferred to (6, 6) but there is no evidence that she violates WARP.</p>

<p><strong>My attempt:</strong>
Obvious conclusion to this question is that (6,6) bundle is preferred to (10,0) bundle when prices are (6,7) but when the prices are (5,5) everything is the other way round thus it violates the WARP whereas the correct answer as stated in the questionbank is A why is that?</p>

CC BY-SA 3.0
2016-01-17T22:11:14.900Z
Please google what WARP is or check your calculations instead of posting a straightforward exercise per day.
Giskard
CC BY-SA 3.0
2016-01-18T08:23:36.457Z
Three questions so far, huge number.
mkropkowski
CC BY-SA 3.0
2016-01-18T09:49:52.570Z
Even one may be too much, but you actually have nine questions with one  vote in total.
Giskard
CC BY-SA 3.0
2016-01-18T09:59:51.997Z
I would not say that it is prohibited to have questions with zero votes.
mkropkowski
CC BY-SA 3.0
2016-01-18T10:46:14.560Z
It is definitely not prohibited. Does it make you think though?
Giskard
<microeconomics>
Violating WARP or not?
mkropkowski
# Violating WARP or not?

(Asked by: username_0 on 2016-01-17)

If the only information we had about Goldie were that she chooses the bundle (6, 6) when prices are (6, 7) and she chooses the bundle (10, 0) when prices are (5, 5), then we could conclude that

a.
the bundle (6, 6) is revealed preferred to (10, 0) but there is no evidence that she violates WARP.

b.
Goldie violates WARP.

c.
the bundle (10, 0) is revealed preferred to (6, 6) and she violates WARP.

d.
neither bundle is revealed preferred to the other.

e.
the bundle (10, 0) is revealed preferred to (6, 6) but there is no evidence that she violates WARP.

**My attempt:**
Obvious conclusion to this question is that (6,6) bundle is preferred to (10,0) bundle when prices are (6,7) but when the prices are (5,5) everything is the other way round thus it violates the WARP whereas the correct answer as stated in the questionbank is A why is that?

**Tags:** microeconomics

> **Comments:**
> **username_1**: Please google what WARP is or check your calculations instead of posting a straightforward exercise per day.  
> **username_0**: Three questions so far, huge number.  
> **username_1**: Even one may be too much, but you actually have nine questions with one  vote in total.  
> **username_0**: I would not say that it is prohibited to have questions with zero votes.  
> **username_1**: It is definitely not prohibited. Does it make you think though?  

---

## 1 answers

### Answer by username_2 on 2016-01-17. Score: 3 | Accepted answer

When she chooses the bundle (6,6) when the prices are (6,7), she spends
\begin{equation\*}
6\*6+6\*7=78
\end{equation\*}
The total price of the bundle (10,0) given this price system is
\begin{equation\*}
10\*6+0\*7=60<78
\end{equation\*}
Therefore she could afford the bundle (10,0) if she wanted to. The fact that she chooses (6,6) reveals that she prefers (6,6) to (10,0).

Given the price system (5,5), when she chooses the bundle (10,0) she spends
\begin{equation\*}
10\*5+0\*5=50
\end{equation\*}
And the price of the bundle (6,6) would be
\begin{equation\*}
6\*5+6\*5=60
\end{equation\*}
Therefore (6,6) is not necessarily affordable if her budget is comprised between 50 and 59. This is why (10,0) is not revealed preferred to (6,6) in that case, and thus there is no evidence that she violates WARP.

> **Comments:**
> **username_1**: Current stats for this question: 2 views, 1 answer and 1 vote to close :)  

---

