1. (5 points) Suppose Bill consumes bundles with two goods, gum and ambrosia. His original budget line is blue on the picture below, budget sets are shown in yellow. What changes in prices of the goods and/ or his income can lead to the observed shift of his budget constraint om the blue line to the orange line? Ambro si 3 2. (5 points) List the two rationality assumptions we make about consumer's preferences. Why do we make these assumptions in our analysis of consumer behavior