Over the past decade medical costs have increased more rapidly than other prices. In order to illustrate how rising medical costs have affected consumer alternatives, let X represent the quantity of medical services, and let Y represent the quantity of other services. Furthermore, let income (M) be measured in hundreds of dollars, the price of medical services and other services in terms of dollars per minute, with M = 100, P_X = $4, and P_Y = $5.

a. Graph the Budget Line based on the information in this problem.

b. Compute the MRS for this consumer of medical services and other services.

c. Suppose the P_X increases to $10.Graph the new Budget Line based on this change.

d. Compute the MRS for the new Budget Line based on a P_X = $10.

e. Provide an interpretation of the change in the MRS from the Budget Line in a. and the Budget Line in c. above.