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Suppose That a Consumer's Increase in Nominal Income from the Base

Question 81

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Suppose that a consumer's increase in nominal income from the base year exceeds the inflation level given by a Paasche cost of living index for their level of purchases: Suppose that a consumer's increase in nominal income from the base year exceeds the inflation level given by a Paasche cost of living index for their level of purchases: Is this information enough to imply how the consumer's level of well-being has changed? (Hint: Use a revealed preference argument.) Is this information enough to imply how the consumer's level of well-being has changed? (Hint: Use a revealed preference argument.)

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There is not enough information to deter...

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