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Problem 2 Anna buys only two goods apples and pears, and these goods are substitutes. U(A, P) = 3A + 2P. A kilogram of apples
Problem 2 Anna buys only two goods apples and pears, and these goods are substitutes. U(A, P) = 3A + 2P. A kilogram of apples costs $3, and a kilogram of pears costs $1. Anna's budget is $30. 0 Determine bundle 0 Find income and substitution effect on pear consumption if price of pears increases to $3 0 Find income and substitution effect on apple consumption if price of apples increases to $4
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