1) Given:
U(x1,x2)=3x1+6x2
I=P1X1+P2X2
P1= 4,
P2= 5,
I = 20
a) Write the function for the indifference curve and graph it when U=10.
b) Write the function for the budget constraint and graph it.
c) What are the utility maximizing amounts of X1 and x2 given the budget constraint?
d) Do the utility maximizing amounts of X1 and X2 change if P1 increases to 5 while P2 stays constant at 5? Why or why not?
e) Do the utility maximizing amounts of x1 and x2 change if P2 increases to 9 while P1 stays constant at 4? Why or why not?
For a is the function of the indifference curve just the MRS?