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Consider a consumer with preferences over two goods [good :5 and good yl given by (2.y]==-y- Herenaandbtl. Given income of I and price of good
Consider a consumer with preferences over two goods [good :5 and good yl given by \"(2.y]==-y"- Herenaandbtl. Given income of I and price of good 1,! as SP, per pound and price of good a: given as 8P, per pound. the consumer chooses the optimal consumption bundle given as .- = (a...) (1%,) and Given a: : 3, B : 7, income of! = $300 and Pg 2 $3 per pound and P8 = $5 per pound. (21] Find the optimal consumption bundle. i.e.. (2', y'} andufm' , y'). (bi Let price of good :r: change as given in ve table below (in increments of one dollar). P: 13* yr s_1 $2 $3 34 "g 36 $7 53 39 Othet price and income do not change. Find the new optimal consumption bundle. i.e.. (2', y' } and compiete the table. (cl Draw the price consumption curve with optimal quantity of good 2 on the horizontai axis and with optimal quantityr of good y on the vertical axis. (d) DrawI the inverse demand curve with quantity of good 3 on the horizontal axis and the price of good a: on the vertical axis
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