Mike does not sweat the petty stuff. In fact, he just cannot detect small differences. He consumes
two goods, x and y. He prefers the bundle (x, y) to the bundle (x′, y′) if and only if xy − x′y′ > 1.
Otherwise, he is indifferent between the two bundles.
(a) Is the relation of indifference transitive for Mike? Explain. (5 Marks)
(b) Is the preferred