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Exercise 10: You are the owner of a supermarket that wants to understand your client's preferences so that you can optimally price your products. You

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Exercise 10: You are the owner of a supermarket that wants to understand your client's preferences so that you can optimally price your products. You record a client's purchases of two products x1 and 12 in 8 different occasions. The following table summarizes the results (for a similar exercise see Varian, ch.5, sec.4): Obs. P1 P2 94 12 29 106 15 38 95 10 25 170 20 50 83 15 38 135 30 75 143 22 55 168 28 70 a. Notice observations number 2 and 5. Quantities purchased are the same but prices are not. What does this mean in terms of the marginal rate of substitution at those quantities? b. Plot the 8 bundles purchased by the individual in a graph

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