Question: 2. Assume a consumer spends her budget over two goods: X (housing) and Y (food). There was a proportional tax increase on housing. Graphically show

2. Assume a consumer spends her budget over two goods: X (housing) and Y (food). There was a proportional tax increase on housing. Graphically show the income and substitution effects following the tax change (assuming that the price of food, Py, remains the same). Show by how much this consumer (of X and Y) should be compensated for the tax increase, to be to as well of was before

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