Question: 3. (17 marks] This question is designed to examine how we can utilize our basic theory without having an explicit indifference curve. Suppose Lia has

3. (17 marks] This question is designed to examine how we can utilize our basic theory without having an explicit indifference curve. Suppose Lia has an income of Y : $500 and only consumes two good: memory sticks (to store free economics papers she downloads from the library) and hardcover novels (which she refuses to check out from the library). Furthermore, let the price of memory sticks be P3 = $25 and the price of hardcover novels be PN = $20. (a) (5 marks) Create a graph of Lia's behaviour with the assumption that her utility is consistent with our normal assumptions (leg. 333'me > U and WEI/def

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