Suppose that Jim uses his budget to purchase 100 units of Good X and 100 units of Good Y. When the price of Good X rises, he purchases 70 units of Good X and 95 units of Good Y. An economist calculates his compensated budget and finds that in that scenario, Jim would buy 80 units of Good X and 105 units of Good Y. Required:
Calculate the income effect

the income effect is -10

Explanation:

The computation of the income effect is given below:

The income effect is

= final demand - compensated demand

= 70 - 80

= -10

hence, the income effect is -10

We applied the above formula to determined the income effect

hence, the same is to be considered

idk the answer so dont listen to me but 23

the correct answer is economics is a game without winners or losers.

unlike sports or games economic is a game without losers or winner rather it is a game where everyone wins. parties of business doing businesses exchange money with each other and hence exchange is done on the basis of goods. one party takes the goods and other sales it so there is winner on both sides. each party values more highly the good it gets than the good it gives up. both sides exchange only because both intend to increase their value. so there is no concept of lose or win.