1. Business
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Question: in detail show and explain all steps...

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3. Suppose there are two goods, X and Y. My utility function over these goods is given by U(X, Y) X 3Y. Suppose I have S40 to spend on these two goods. Good X has a price of S2 per unihpi Y is Si per unit. (a) Derive the equation for my budget line. Draw it on a graph, labeling the intercepts. Graph consumption of X on the horizontal axis, and consumption of Y on the vertical axis. What is the slope of this budget line? (b) Draw three representative indifference curves, labeling the level of utility and in- tercepts on each axis for each one. (c) At these prices, what bundle will I purchase? Explain and illustrate on a graph At the optimal bundle, how does my marginal rate of substitution compare to the rate at which I can substitute one good for another along the budget line?

In detail show and explain all steps

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