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Economics 1. Imagine you have $1000 of income to spend on two goods, x1 and x2. ASSUME BOTH AR NORMAL GOODS. The price of x2 is p2 = 20. Holding p2 constant, draw your three budget line: show what your indifference curves might look like, and based on these what your optima bundles would be for three different prices for x1: p1 = 40, pi' 20, and pi" = 10. Then use this information to derive your demand curve for x1. %3D %3D

Economics 1. Imagine you have $1000 of income to spend on two goods, x1 and x2. ASSUME BOTH AR NORMAL GOODS. The price of x2 is p2 = 20. Holding p2 constant, draw your three budget line: show what your indifference curves might look like, and based on these what your optima bundles would be for three different prices for x1: p1 = 40, pi' 20, and pi" = 10. Then use this information to derive your demand curve for x1. %3D %3D

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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ASAP help it is economic problem
Economics 1. Imagine you have $1000 of income to spend on two goods, x1 and x2. ASSUME BOTH ARE NORMAL GOODS. The price of x2 is p2 20. Holding p2 constant, draw your three budget lines, show what your indifference curves might look like, and based on these what your optimal bundles would be for three different prices for x1: pi = 40, pi' 20, and pi" = 10. Then use this information to derive your demand curve for x1. %3D %3D Your answer Typed answers are easier for students to read than handwritten notes - fx B IU A; A :-
Transcribed Image Text:Economics 1. Imagine you have $1000 of income to spend on two goods, x1 and x2. ASSUME BOTH ARE NORMAL GOODS. The price of x2 is p2 20. Holding p2 constant, draw your three budget lines, show what your indifference curves might look like, and based on these what your optimal bundles would be for three different prices for x1: pi = 40, pi' 20, and pi" = 10. Then use this information to derive your demand curve for x1. %3D %3D Your answer Typed answers are easier for students to read than handwritten notes - fx B IU A; A :-
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