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We consider a utility-maximizing consumer with the utility function U (X1, X2 = 4 (X1 + 2) X2 WE ASSUME THAT THE CONSUMER HAS A

We consider a utility-maximizing consumer with the utility function U (X1, X2 = 4 (X1 + 2) X2

WE ASSUME THAT THE CONSUMER HAS A GIVEN BUDGET OF 10 NOK. THE PRICE OF X1 IS ONE KRONE AND THE PRICE OF X2 IS TWO KRONER.

A) SET UP THE CONSUMER'S MAXIMIZATION PROBLEM AND CALCULATE THE EQUILIBRIUM QUANTITY BASED ON THE INFORMATION ABOVE

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