Walt considers x and y to be perfect substitutes

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Walt considers x and y to be perfect substitutes. They originally cost $10 and $9 respectively. His income is $720. One day the price of x drops to $8.

a. The income effect increases the quantity of y by 90.

b. The substitution effect increases the quantity of y by 80.

c. The substitution effect increases the quantity of x by 90.

d. The income effect increases the quantity of x by 80.

e. None of the above.

Reference no: EM13886958

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