Question: 3 . 1 Utility Maximization A consumer allocates their income M = 6 0 between two goods, Good 1 and Good 2 , with prices

3.1 Utility Maximization A consumer allocates their income M =60 between two goods, Good 1 and Good 2, with prices p1=4 and p2=6, respectively. The consumers preferences are represented by the utility function: U(x1, x2)= x 0.71 x 0.32. Tasks: 1. Set up the budget constraint. 2. Find the optimal bundle of quantities x 1 and x 2 using either one of the following two methods: : Marginal Rate of Substitution (MRS) equals to price ratio. Lagrangian method. 3. Calculate the maximum utility the consumer achieves with that optimal bundle.

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