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mmmmm mam 2. Jennifer buys two goods, food (F) and clothing (C), with the utility function U{F,C] = FC. Assume initially that she has an

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mmmmm mam 2. Jennifer buys two goods, food (F) and clothing (C), with the utility function U{F,C] = FC. Assume initially that she has an income of $79, the. price of clothing is PC = $1 per unit, and the price of food is initially Ppl = $9 per unit and that the price subsequently falls to sz = $4 per unit. Use this information and the accompanying graph to answer the following questions. {3.) Find the equation for budget line (5L1) when the price of food is $9. {b} Find the initial consumption bundle A when the price of food is $9. {4:} Find Jennifer's utilitf,r (U1) at consumption bundle A. {d} Find the equation for budget line (3L2) when the price of food is $4. {e} Find the consumption bundle C when the price of food is $4. Find Jennifer's utility {U2} at consumption bundle C. (l) Find the equation for budget line (BLd) when the price of food is $4 and income is (Id). (g) Find the consumption bundle B using budget line {Big} and U; = FC {h} Find the income and substitution effects and show that Price Effect. (PE) = Income Effect (IE)+ Substitution E'eet (SE)

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