Solution

ID: past-exam-of-the-mathematics-course-of-the-university-of-cambridge/2004/iii/paper-36/1/b/solution

The congruence axiom requires that an affordable alternative indirectly revealed at least as desirable as a chosen alternative is itself chosen. In the notation of part (a),
Equivalently, a chosen bundle and an affordable but unchosen bundle satisfy . Since already holds, this means . The axiom therefore distinguishes a genuine strict preference for a chosen bundle from indifference between two chosen bundles; it applies to the entire demand correspondence, including budgets with several chosen alternatives.

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