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2. Consider the three choice functions given in Parts 2.1, 2.2, and 2.3, respectively. For each of these choice functions, in

Within the circles the variables on the top part of the circle are an agent's best choice. For example, if given the option of X or Y, an agent will choose X because to them it is the best choice or preference.

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Answer #1

The bundle {w,x} violates the WARP condition. Since, x is preferred to y and w is preferred to x, the consumer must definitely prefer w over y. Now, the consumer also prefers y over z. Hence, due to transitivity the consumer would automatically prefer w over z which is not the case in the provided bundle. Since the consumer chose a weaker preference over a stronger preference, the Weak Axiom of Revealed Preferences is violated.

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