Felix loves steaming shows on two platforms, A and B. He is willing to substitute 2 hours spent on

A for 3 hours spent on B. Let xA denote his time spent on A and xB denote his time spent on B.

(a) Write down one example of Felix's utility function u(xA,xB). (2 Marks)

(b) Let pA denote platform A's price of streaming service and pB denote platform B's price of streaming service. Felix's budget is denoted as m. Derive his demand functions xA(pA,pB,m) and xB(pA,pB,m). (6 Marks)

(c) On a graph, draw Felix's price offer curve when pB changes. (4 Marks)

(d) Suppose that pA = 15 and pB = 9. On another graph, draw Felix's Engel curve for his time

spent on platform B. Clearly label the slope of the curve. (4 Marks)

(e) Under what condition of prices is Felix's time spent on platform A a normal good? Under what condition of prices is Felix's time spent on platform B an ordinary good? (4 Marks)