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You eat only Pink lady apples, say, or Granny smith apples, 2 . You are comparing two local supermarkets, Weightrose and Senseberries. In Weightrose the

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You eat only Pink lady apples, say, or Granny smith apples, 2 . You are comparing two local supermarkets, Weightrose and Senseberries. In Weightrose the price of Pin lady apples is 2 and the price of Granny smith apples is 3. In Senseberries the price of Pink lady apples is 3 and the price of Granny smith apples is 2. Your utility from a consumption bundle (111 a3) is given by amafag) = 39931\"? You have 60 to spend. a. Compute the MRS between 2;? and ray. [6 marks] b. Write the formula for the budget constraint in each of the supermarkets. Draw the budget constraints you have found. [5 marks] 0. Compute the optimal consumption bundle (a; tag) in each supermarket as a function of E}. [6 marks] d. Assume that 9:0.6. On the same graph, show the optimal consumption at each supermarket. By looking at your drawing or by doing some calculations can you tell which supermarket would you prefer to do your shopping in? Explain your answer. [6 marks] e. Assume that 9:0.4. On the same graph, show the optimal consumption at each supermarket. By looking at your drawing or by doing some calculations can you tell which supermarket would you prefer to do your shopping in? Explain your answer. [6 marks] f. For what value of B would you be indifferent as to which supermarket would you prefer to do your shopping in? Explain your answer. [6 marks]

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