1. If the utility function for Income under Budget constraint is U (x₁, x₂) = max {x₁, x₂},

Where max = maximum number between x₁, and x₂

Then;

a) Please draw three budget constraints, where Income m₁< m₂ < m_3, and find the income offer curve and Engle Curve

b) Please draw three budget constraints, price p₁< p_2< p_3, and find the Price Offer curve and Demand curve

c) If the utility function is a Cobb-Douglas preference, please do the (1) and (2) again.

2. If the utility function is U (x₁, x₂) = 10(x₁²+2 x₁x₂+ x₂²)-50, then we say commodity 1 and commodity 2 are perfect-substitutes. Do you think the conclusion is correct or not? Why? Please explain.