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Need help Suppose Bob consumes two goods *, and Xa. His budget is $20 and the market prices of *1 and *2 are P1 =

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Suppose Bob consumes two goods *, and Xa. His budget is $20 and the market prices of *1 and *2 are P1 = 2 and Pa = 2 respectively. The utility of Bob of consuming *1 units of *1 and *2 units of Xa is u ( X] , *2) = /*1 + 2 *2 . Suppose that the price Pi drops from $2 to $1. The subsitution effect of the price change of Pi is O a. Bob consumes more *1 and consumes the same amount of *a O b. Bob buys 4 units more of *1 and 2 units less of *a . O Bob buys 2 units more of *1 and 2 units less of *a Od. 14 Bob buys units more of *1 and 3 units less of *2

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