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a. Two goods are in the consumer basket, goods X and Y. The consumer income is I , price of good X is Px ,

a. Two goods are in the consumer basket, goods X and Y. The consumer income is I, price of good X is Px, and price of good Y is Py. Use the consumer model to derive the demand curve for good X. Explain your answer in details.

b. Using your answer in part a, clearly explain and show the substitution effect and the income effect.

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