spent on pizza principal of marginal analysis confirm the same bundle you identified 3. (20 points) Tommy has $66 to spend on tacos and burritos which are both normal goods for Tommy. The price of a burrito is $6 each and price of each taco is $2 each. All parts a through e should be drawn on the same chart. In this question we assume that fractions of tacos and/or burritos are possible. a. Draw Tommy's budget line with tacos on the x-axis and burritos on the y-axis. b. Assume Tommy spends half his money on tacos. Put a dot at this point and label it "A". c. On the same chart draw a new budget line. Assume that the price of tacos has risen to $3. d. Choose a new consumption point for Tommy and label it "B". e. With regard to burritos, which is stronger for Tommy -- the substitution effect or the income effect? (To answer this part you need to correctly interpret the graph you drew in parts a through d. The answer to part e will depend on where you placed the dot in part d.) 4. (15 points) For each of the following situations, decide whether the bundle Ellen is considering is optimal or not. If it is not optimal, how could Ellen improve her overall level of utility? That is, determine which good she should spend more on and which good she should spend less on. a. Ellen has $500 to spend on shoes and hoodies. The price of shoes is $100 per pair and the price of hoodies is sweaters is $50 each. She is thinking about buying 3 pairs of shoes and 4 hoodies. She tells her friend that the additional utility she would get from the fourth hoodie is half the additional utility she would get from the third pair of shoes. b. Ellen has $20 to spend on pen and pencils. Each pen costs $2.00 and each pencil costs $0.50. She is the last pencil. thinking about buying 6 pens and 16 pencils. The last pen would add five times as much to her total utility as c. Ellen has $100 per season to spend on tickets to football games and tickets to soccer games (Go Huskies!) Each football ticket costs $20 and each soccer ticket costs $10. She is thinking about buying 3 football tickets and 2 soccer tickets. Her marginal utility from the third football ticket is twice as much as her marginal utility from the second soccer ticket. 5. Read Consumers Cha