1. Candice's preferences over KitKats (K) and yogurt (Y) are represented by the utility function U(K, Y) = K + 4Y 2. If the price of a KitKat is $5 and the price of a yogurt is $10, what is her optimal consumption bundle assuming she has $300 to spend. Graphically represent her utility maximizing bundle. 2. Candice's preferences over KitKat (K) and yogurt (Y) are represented by the utility function U(K, Y) = K + 2Y2. If the price of a KitKat is $5 and the price of a yogurt is $10, what is her optimal consumption bundle assuming she has $300 to spend. Graphically represent her utility maximizing bundle. 3. Identify if each of the following statements is true or false. a. With perfect substitute preferences, the consumer will always choose a corner solution. F b. If preferences are rational and monotonic and ICs are convex, the consumer will never choose a corner solution. T c. With Cobb-Douglas preferences, the consumer will never choose a corner solution. T d. With perfect complement preferences, the consumer will never choose a corner solution. T e. If preferences are rational and monotonic and ICs are concave, the consumer will always max choose a corner solution. max ! 1) V (kiy ) = Ktuy ' / 2 2 ) K + 2 y /2 MRS = MIX - 1 + 4y/2 _ 1+ 24 Mry K + zy - 1/2 K 30 30 103 ICI K K