5. A person's preferences over brands of shampoo (P stands for Pert; D stands for Dove) are represented by U =P + 1.2D a. Suppose that Pert sells for $3 for a 32-ounce bottle, and Dove sells for $4 per 32 ounce bottle: P =3; P. =4. Suppose he plans to spend $12 this year on shampoo. How should he optimally spend his money? b. Suppose now that the price of Pert remains $3, but Dove lowers its price to $3. Now how should our person optimally spend his $12? c. One day, our consumer walks into a store where he is offered a free bottle of either Pert or Dove(not both). Given his preferences, which one will he choose? 6. Below are three estimates of the market demand for Jiff peanut butter. The letters stand for the following: O is quantity of Jiff (in 1000s of jars); P is the price of Jiff (in $ per jar); P, is the price of bread (a complementary good) in $ per package; P is the price of Peter Pan peanut butter (a substitute good) in $ per jar; / is average income (in $1000s). Each demand estimate has at least one problem that should concern an economist. Under each demand, list one (and only one) problem with the estimate. Q = 150p -125 p.05 p2 1-5 0 = 100p-12 p> p02 Q = 50p025 p0.05 p05 ]