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Mr. A derives utility from martinis (m) in proportion to the number he drinks Mr.A is particular about his martinis, however: He only enjoys them made in the exact proportion of two parts gin (g) to one part vermouth (v). Hence, we can rewrite Mr.As utility function as: The following graph measures gin (g) along the horizontal axis and vermouth (v) along the vertical axis. On the following graph, use the purple points (diamon symbols) to plot Mr.As indifference curve for U the points from left to right in the order that you wish them to connect. 2. The points will connect automatically. Plot 10 U-2 4 Gin (g)The shape of the indifference curves, along with the utility function, imply that vermouth and gin are Let py be the price of vermouth and pg be the price of gin. Also let / represent Mr.As income. Mr.As demand curve for gin is g , while his demand curve for vermouth is v Based on the demand functions for gin and vermouth, which of the following function best describes Mr.As indirect utility function? Let E denote the expenditures required, given the current prices and income, to attain the utility level Mr.As expenditure function is can be stated as E

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Date:I Cu At obtimal comelttion and 2i2 The L-shape Ic Iablies that cruth ore befeck complements budget lenstraint ul and isu tunch 2

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