Question: JUST DO THE DIAGRAM AND EXPLANATION FOR QUESTION D. THX A consumer's utility function is given by: U(x,y) = 10xy Currently, the prices of goods

JUST DO THE DIAGRAM AND EXPLANATION FOR QUESTION D. THX

A consumer's utility function is given by:

U(x,y) = 10xy

Currently, the prices of goods x and y are $3 and $5, respectively, and the consumer's income is $150.

a.Find the MRS for this consumer for any given bundle (x,y).

b.Find the optimal consumption bundle for this consumer.

c.Suppose the price of good x doubles. How much income is required so that the consumer is able to purchase the original consumption bundle?

d.Now that the price of good x has doubled, how much income is needed for the consumer to reach the original level of utility? Is this more or less than what you found in part c? Explain using a diagram.

JUST DO THE DIAGRAM AND EXPLANATION FOR QUESTION D. THX

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