Utilizing indifference curve analysis to show housing rented

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Reference no: EM135061

Suppose low-income people are given vouchers worth $200 per month that they can use only to pay rent on housing. Use indifference curve analysis to show how the person could be as well off with a $200 cash transfer. Would the consumer's choice of the amount of housing to rent be any different if he/she receives cash instead of housing vouchers? Utilizing indifference curve analysis to show under what circumstance the $200 per month housing vouchers would cause the recipient to increase the amount of housing rented (measured in square feet) compared to what would be rented if the recipient received $200 in cash in lieu of the housing vouchers. Would this receiver be as well off under the housing voucher scheme as he/she would be with a cash transfer of equal value?

Reference no: EM135061

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