a.Diagram 1 shows alternative indifference curves (IC₁ and IC₂) and budget constraint lines (BC₁, BC₂, BC₃) for Jennifer who enjoys consuming tacos with soda. Based on the Budget Constraint BC₁, if the consumer's income is $28, what is the price of a taco and a can of Pepsi?

Price of Taco is $4 and can of Pepsi is $4

b.With BC₁, what combination of tacos and Pepsi quantities maximizes this consumer's satisfaction?

4 units Pepsi and 3 units of Tacos maximizes the consumer's satisfaction.

c.At point (4,3) what is the marginal rate of substitution (MRS_xy) between the two products?

-1 is the MRS between the 2 products. She is willing to give up 1 unit of Soda and gain 1 unit of Pepsi.

d.Assume the new budget line is BC₃. What has changed from BC₁ with the prices of soda and/or taco, and the new consumer equilibrium? What combination of tacos and Pepsi quantities optimizes the consumer's utility?

e. Explain the possible specific reasons for the shift of the budget constraint from BC₁ to shift to BC_2.

_{Assuming my answers highlighted in bold are correct from the attached image, I am confused as to what the answers for d) and e) are. How can I know the new price of taco and pepsi without knowing the new income?}