Hand written solutions are strictly prohibited 5. Consider the example of the representative consumer choice we saw in class.Assume consumption (C) and leisure (I) are perfect complementsu(LC) = min(Cal).The consumer's budget constraint is given byС=w(h-1) +π-T,where w represents real wages, represents profits distributed asdividends, T represents a lump sum tax, and h represents total hoursavailable. Assume L(b) Suppose that a = 8, h = 24, w = 10 and π - T = 48. Determine theconsumer's optimal choice of consumption and leisure, and show thisin a diagram.(c) Now suppose that wages change resulting in /* = 14 with everythingelse constant. Did wages decrease or increase? Plot the newequilibrium in a diagram and interpret the results with reference tosubstitution and income effects.

Utility function : U = min {C , al )Perfectly complementing between consumption and leisure…

5. Consider the example of the representative consumer choice we saw in class. Assume consumption (C) and leisure (I) are perfect complements u(LC) = min(Cal. The consumer's budget constraint is given by C=w(h-1) +- T

5. Consider the example of the representative consumer choice we saw in class. Assume consumption (C) and leisure (I) are perfect complements u(LC) = min(Cal. The consumer's budget constraint is given by C=w(h-1) +- T

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Please see below. I need assistance on this graphing problem.
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