Question: Please help in answering this question. need to compare with what I have at the moment 5. Jane drinks Beer (B) only when she consumes

Please help in answering this question. need to compare with what I have at the moment

Please help in answering this question. need to compare with what I

5. Jane drinks Beer (B) only when she consumes bags of Chips (C) Jane always consumes two bottles of beer along with a bag of chips. They are perfect complements for Jane. Price of a bottle of beer is 52 while the price of a bag of Chips is $2. Assume you can consume fractions or decimals of each product. Jane's income is $50. A. Set up Jane's utility function. Draw and label two ofJane's indifference curves. [2] B. Calculate the number of {B, C} pair Jane consumes and corresponding level of utility for Jane, as setup in part A). What is the intuition behind the solution? Draw and label the budget constraint, solve for Jane's optimal choice and present your answer graphically. [5] C. Suppose the quantity discount is imposed on Beer. The price of Beer is $2 up to 10 bottles of Beer, and $1 from the 10th bottle of Beer and up. How does her choice and budget constraint change? What happens to her utility? (Present your answer graphically as well). [5]

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