3) Suppose I=$ 1000, Py=$ 10, Px=$20 and the consumer starts in equilibrium at e0 If PX decreases to $10, derive the demand curve for
3) Suppose I=$ 1000, Py=$ 10, Px=$20 and the consumer starts in equilibrium at e0 If PX decreases to $10, derive the demand curve for X based on the given budget lines and indifference curves and show it on the diagram below. Is demand for good X elastic or inelastic in the relevant price range? (5 marks) Y 100 65 60 25 45 50 100 x
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