c. Comme 4. Construct the relevant constraint for Bryce who spends his entire income on X and Y if Income(I) = $120 Px = $5/unit for X 10 (ALL units) Py = $8/unit b. If Bryce buys 8 units of X, do his preferences violate any of the assumptions of consumer choice theory? c. How would the constraint be affected if the discount applies to additional units only? 5. Darcy buys two goods, magnets and cheeseburgers. The price of a magnet is $1 and the price of a cheeseburger is $2. Darcy spends all of her income and buys 30 magnets and 5 cheeseburgers. The next month the price of a magnet will fall to $0.50 and cheeseburgers will rise in price to $5.00. Assume Darcy's preferences are illustrated by a downward sloping indifference curve(convex). a. Will Darcy be able to afford to buy her initial bundle when prices change? b. If, at the original prices, Darcy's marginal utility for additional magnet is 40 and her marginal utility for another cheeseburger is 80, is she maximizing her utility? Briefly explain. 6. The market for soybeans is highly competitive, with the hypothetical market supply and demand curves given by Qd = 20,000,000 - 4,000,000P Qs = 7,000,000 + 2,500,000P where Qd: quantity demanded, Qs: quantity supplied, P:price per bushel a. Plot the demand and supply curves and determine the equilibrium price and quantity of soybeans exchanged in this market. b. Suppose a price floor is imposed of $2.50 on this market. What is the impact of this price floor on the market(Qd,Qs)? Farm incomes? 7. In a study of the New York Transit Authority, Steven discovers that subway ridership elastic to bus fares is 0.6. with respect to subway fares is 0.15 while the cross elasticity of demand for subways with resp