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. Basket A contains 5 apples and 1 orange. Basket B contains 1 apple and 5...

. Basket A contains 5 apples and 1 orange. Basket B contains 1 apple and 5 oranges. Basket C contains 3 apples and 3 oranges. Assume throughout that tastes are monotonic. On Monday, Anne is offered a choice between basket A and C, and she chooses A. On Tuesday, she is offered a choice between basket B and C, and she chooses B.

a) Graph these baskets on a graph with apples on the horizontal and oranges on the vertical axis.

b) If we assume that Anne’s preferences on any given day satisfy a strict convexity assumption (averages are strictly better than extremes), can we conclude that Anne’s preferences have changed from Monday to Tuesday?

c) Suppose that Anne’s preferences satisfy a weak convexity assumption (averages are at least as good as extremes). Suppose also that her preferences have not changed from Monday to Tuesday. Can we conclude anything about the precise shape of one of Anne’s indifference curves?

Consider the utility function U(x, y) = 3x + 2y, where x are units of apples and y are units of oranges.

d) What is the equation of an indifference curve?

e) What is the MRS at basket A? What is it at basket B? What is it at basket C? What is the geometric equivalent of the MRS? What is the interpretation of the MRS? Note, MUx = 3 and MUy = 2

f) Can this utility function capture preferences that give rise to the conclusion about the shape of one of the indifference curves in part c)?

I need help with d,e and f

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