solve it a) Assume that an individual consumes two goods, and achieves the benebitby consumingrespectively 1 x and x units of each of the goods.Define the terms indifference curve and budget condition, and show the consumerbenefit-maximizing good combination in a chart. Explain why this onethe combination solves the utility maximization problem.b) Assume that the preferences of the consumer can be expressed by the utility function0.5ux),4+ X,2p = ard thatand that the price per unit x 1 is ip =, the price per unit x 2 is 2the income ( m) is 200. Find the consumer's optimal choice in this case.c) Show on the basis of the utility function given in problem (b) that the demand functionsfor the goods are given byAP2AP2mand · x,P22P.x and m are the income ofis the price per unit 1x , 2 p is the price per unit 2der1the consumer.d) Explain what is meant by cross-price effects. Be based onthe demand functions in problem (c), and explain how the cross-price effects caninterpreted in this case.

(Since you have asked many questions, we will solve the first one for you. If you want any specific…

a) Assume that an individual consumes two goods, and achieves the benebitby consuming respectively 1 xand x units of each of the goods. Define the terms indifference curve and budget condition, and show the consumer benefit-maximizing good combination in a chart. Explain why this one the combination solves the utility maximization problem.