Question: 3. (24 total points) Suppose a consumer's utility function is given by U(X,Y) = X*Y. Also, the consumer has $180 to spend, and the price

3. (24 total points) Suppose a consumer's utility function is given by U(X,Y) = X*Y. Also, the consumer has $180 to spend, and the price of X. Px = 4.50, and the price of Y. Py = 2. a) (4 points) How much X and Y should the consumer purchase in order to maximize her utility? 180 180 q 4 145 b) (4 points) How much total utility does the consumer receive? U(x ' , VC) = 20 . 45 = 1900 c) (4 points) Now suppose Px decreases to 2. What is the new bundle of X and Y that the consumer will demand? IV 180 4 4 5 145

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