1) Consider a consumer in a two period economy. Denote consumption goods as c1 and c2.

Suppose that this consumer has an endowment of (6,0). Suppose that this consumer has access to markets (where goods 1 and 2 are traded for one another) and that the price ratio is 1 + r.

(a) Assume that this consumer also has access to a technology which allows her to transform x1 units of the period 1 good into x2 = x1 units of period 2 good. State the consumer's budget set/budget line.

(b) Now assume that a profit maximizing firm operates this technology and that the consumer owns the firm. State the consumer's budget set/budget line in this case.