Question: Question 1 (15 marks) Consider a consumer with quasilinear utility function: 1/2 371 +332 Assume that p2 = 1 and p1 > 0. Q1a. (3

Question 1 (15 marks) Consider a consumer with quasilinear utility function: 1/2 371 +332 Assume that p2 = 1 and p1 > 0. Q1a. (3 marks) Sketch the indifference curves (ICs) of this utility function, noting that the MRS of this utility function is: l 1 _:C1 1/2 2 Indicate the special properties of the ICs, if any. Q1b. (3 marks) Derive the demand functions m1(p1,1),x2(p1,1) of this consumer. Q1c. (3 marks) Suppose that I increases by 1. Find the corresponding changes in the demand of two goods. Q1d. (3 marks) Find the level of p1 in which 9:1 : 1 is the optimal level of demand. Qle. (3 marks) What is the gain in utility of moving from 3:1 2 0 to 3:1 2 1 given the price you found in Qld

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