1. True or False: In the two goods consumer demand setting, an increase in one of the prices of a given level can have the same effect on the budget constraint as a given (maybe different) increase in income. ( give the explanation)

2. True or False: A consumer who can borrow and lend at a constant interest rate always prefers a choice of consumption bundles with a higher present value to one with a lower present value. (give the explanation)

3. Ture or False: Assuming fixed input prices, an increase in the price of the output will result in an increase in the profits of the firm. (Give the explanation)