Question: How do I solve this? Suppose that consumers spend their income on either health insurance or on a composite good (a collection of all other

How do I solve this? Suppose that consumers spend their income on either health insurance or on a

"composite good" (a collection of all other goods that a consumer wants). Find the

optimal bundle of health insurance (HI) and other goods (G) given the following

budget constraint and utility function. Make sure to show how you arrived at your

answer. How much utility does this bundle give the individual?

Budget constraint: 1000 = 100*HI + 25*G

Utility function: U=HI*G where MRS = -G/HI

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