Question: Question 1. Assume that consumer has the following utility function U (X, Y) =0.4*X0.80.2 Income is 200 and price of X and Y is 10

Question 1. Assume that consumer has the following utility function U (X, Y) =0.4*X0.80.2 Income is 200 and price of X and Y is 10 and 5 dollars, respectively. a) find subsitition and income effect in case of new price of good X is 6 dollars. Show it on the graph as well. (3 points) b) Is the good normal or inferior? Why yes and why not? (3 points) C) What will be the value of income and substitution effect if two goods are perfect substitute? (2 points) d) Wat will be the value of income and substitution effect if two goods are perfect complements? (2 points)

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