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Consider the follovi'ing utility maximization problem: U'Imax U(X+F,Y) X,}' 51. M = P,X + Prl' ' where F is the amount of free X3 provided

Consider the follovi'ing utility maximization problem: U'Imax U(X+F,Y) X,}' 51. M = P,X + Prl' ' where F is the amount of \"free\" X3 provided by the government Assume the second order condition is fulfilled. 6X " 61' " BU * 9\"! and v 8F 6F 61" 1)) Now suppose the utility function is additivcly' separable so that UGLY) = U' or). U'm and 0' '(X) > o.u' "m o. and u' "(n

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