1. Tatiana's budget constraint is given by m = 500; P1 =1; P2 = 2.Explain how the budget constraint changes, indicating the feasible area if:

1. a) The government applies a specific tax of 0.1 to good P1.
2. b) The government applies an ad valorem tax of 10% to good P1.
3. c) The government levies a lump-sum tax of 100.
4. d) The relative price is 1 (price ratio of the products on the market).
5. Graphically the initial situation and each case.

m: income

P: prices of goods.