True/False - Briefly explain the reason.
a. The utility function U(X1,X2)=X1^a + 2X2^b. Corresponds to preferences for perfect substitutes.
b. All ordinary (non-Giffen) goods are also normal goods. (Hint: Use the Slutsky equation to support your answer)
c. If consumer consumes only two goods, both of them can be inferior.
d. If a consumer is making an optimal choice between two goods, x and y then, independently of his preferences, the MRS = (-PX)/(-PY) condition must always hold.
e. Any Giffen good is an inferior good. (Hint: Use the Slutsky equation to support your answer)