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Shannon visits Absudistan where the local currency is the absurd; the only souvenirs she is interested in buying are absurdities (X) and nonentities (Y), both

Shannon visits Absudistan where the local currency is the absurd; the only souvenirs she is interested in buying are absurdities (X) and nonentities (Y), both made in China, of course!Her preferences for x and y trinkets are given by:

U = 6x - 0.5x2+ 4y - y2

and PX= 2, PY= 4.

(a)What is Shannon's optimum choice of x and y trinkets if she has 14 absurds to spend.(5)

(b)What is her optimum choice of x and y trinkets if instead she were to have 38 absurds to spend.(3)

(c)Provide a one-sentence explanation to the marginal utility of an absurd obtained in (b) above.(4)

(d)At what income level is Shannon's marginal utility of an absurd equal zero?(5)

(e)Sketch Shannon's indifference curves and budget constraint, illustrating the solutions to (a), (b) and (d).(3)

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