Quasi-linear Indifference preferences curves Final budget line Original budget Pivot Substitution effect=total effect
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X Quasi-linear Indifference preferences curves Final budget line Origina budget line Pivot Substitution effect= total effect
Quasi-linear preferences
Rebating a tax based m+ tx on final consumption Indifference curves (x,y) Budget line after tax and rebate slop y p+0 Budget line before tax slope P Rebating a ta