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In: Economics

Currently, consumers earn 2,000, the price of x-jae is 50 and the price of y-jae is...

Currently, consumers earn 2,000, the price of x-jae is 50 and the price of y-jae is 80. utility function u=1/2xy
(1) Get a Budget Set
(2) Seek a Consumer Balance Point
(3) What is the price effect if the price of x material falls to 20? And what are the income effects and the magnitude of the alternative effects respectively (take into account the magnitude of the utility represented by the indiscriminate curve)?

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Dear Student/ Learner, it was my great pleasure to help you solving this problem. I wish you best luck for your learning endeavour.
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Rahul Sunny answered 2 years ago
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