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1. A consumer has $14 a week to spend on goods X and Y. Initially the, price of X is $2 and the price
1. A consumer has $14 a week to spend on goods X and Y. Initially the, price of X is $2 and the price of Y is $5. At these prices, they consume 2 units of X and 2 units of Y. Suppose the price of Y falls to $2 and then falls to $1. When Py = $2, they consume 3 units of good X and when Py = $1 they consume 3.5 units of X (a) [1 points] Solve for their consumption of Y when Py = 2 and Py = 1. (b) [3 points] Graphically depict these price changes and optimal bundles using budget con- straints and indifference curves. (c) [2 points]Graphically depict the consumer's demand curve for good Y.
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