Problem 2
Suppose that indifference curves are described by straight lines with a slope of \(-b .\) Given arbitrary prices and money income \(p_{1}, p_{2},\) and \(m,\) what will the consumer's optimal choices look like?
Problem 3
Suppose that a consumer always consumes 2 spoons of sugar with each cup of coffee. If the price of sugar is \(p_{1}\) per spoonful and the price of coffee is \(p_{2}\) per cup and the consumer has \(m\) dollars to spend on coffee and sugar, how much will he or she want to purchase?
Problem 6
For what kind of preferences will the consumer be just as well-off facing a quantity tax as an income tax?
