Consider an individual with preferences represented by the following utility function: U (x1, x2) = x¡ x The individual faces prices: P1= 0.5; p2 = 1 And has income: M = 250 If the price of good one...

Extracted text: Consider an individual with preferences represented by the following utility function: U (x1, x2) = x¡ x The individual faces prices: P1= 0.5; p2 = 1 And has income: M = 250 If the price of good one increases to pi =1 For this change in price, mark all of the following answers that are correct. (EV = equivalent variation; CV = compensating variation) O In absolute value, EV is greater than CV O In absolute values, change in Consumer surplus is smaller than CV. O In absolute value, CV is greater than EV In absolute values, change in Consumer Surplus is smaller than EV. There is not enough information to determine an answer.