Rational Constrained Choice X1
Rational Constrained Choice x1 x2 x1 * x2 *
Rational Constrained Choice (X* x2 )is the most preferred affordable bundle X1
Rational Constrained Choice x1 x2 x1 * x2 * (x1 *,x2 *) is the most preferred affordable bundle
Rational Constrained choice The most preferred affordable bundle is called the consumers ordinary DEMAND(一般需求) at the given prices and budget. Ordinary demands will be denoted by X, (p1,P2, m)and X2 (p1,p2, m)
Rational Constrained Choice The most preferred affordable bundle is called the consumer’s ORDINARY DEMAND （一般需求）at the given prices and budget. Ordinary demands will be denoted by x1 *(p1 ,p2 ,m) and x2 *(p1 ,p2 ,m)
Rational Constrained choice When X,*>0 and X2 >0 the demanded bundle is Interior If buying(,* x2 *)costs Sm then the budget is exhausted
Rational Constrained Choice When x1 * > 0 and x2 * > 0 the demanded bundle is INTERIOR. If buying (x1 *,x2 *) costs $m then the budget is exhausted
Rational Constrained Choice (X,*, X2 *)is interior. (X,, X2 *)exhausts the budget X1
Rational Constrained Choice x1 x2 x1 * x2 * (x1 *,x2 *) is interior. (x1 *,x2 *) exhausts the budget