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(miog [) boog to viitaup ban song mundilimps won odd ban 900 TO8 of esesomeat smoogi Il (Jaloq [) (Imlog [) 3. Martha has a
(miog [) boog to viitaup ban song mundilimps won odd ban 900 TO8 of esesomeat smoogi Il (Jaloq [) (Imlog [) 3. Martha has a utility function U - 3X2Y, where X represents the amount of water she consumes (in bottles) and Y represents the amount of beef she eats (in pounds). (She has $10 and uses the money to pay for transportation and to buy water and beef. hnog There are two grocery shops that sell water and beef: Yboog Tohelal to Iamon a (injog ). Shop A, where PA = $3 a bottle and PA = $1 per pound. If she buys there, Martha's total transportation costs are $1 . Shop B, where PP = $1.6 a bottle and PB = $1.2 per pound. If she buys there, Martha's total transportation costs are $2.8 Suppose that if she goes to one of the shops, she does all of her shopping there. (a) If she goes to Shop A, what's her optimal bundle (XA, YA)? (2 points) (b) If she goes to Shop B, what's her optimal bundle (XB, YB)? (2 points) (c) Which shop will Martha go to? (1 point)
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