Questions 4 (Choice & Demand). Suppose a consumer's utility function is given by:

U(x₁, x₂ ) = x₁^0.4*x₂^0.6

1. What is the consumer's demand for x₁ as a function of income and prices? What is the consumer's demand for x₂ as a function of income and prices? Use Lagrange method or your intuition.

1. What percentage of income does the consumer spend on x1? What percentage of income does the consumer spend on x₂?