Question - Michael has $900 per month to spend on steaks and books. The prices of these commodities, his current quantities purchased, and his evaluation of the utility provided by these quantities, are as follows: Units Total Marginal Price Bought Utility Utility Steaks $8 75 1000 3 Books $3 100 750 1.2
(i) What is the slope of Michael's indifference curve through his current consumption bundle?
(ii) What is the slope of Michael's budget line?
(iii) Would Michael be able to raise his welfare by changing his consumption bundle? If yes, should he buy more steaks and fewer books of vice versa?
(iv) In equilibrium, how many steaks would Michael be willing to trade for one book?