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A company must divide $250 between the consumption of product x and product y. The relevant market prices are Px=$5 and Py=$10
a.Write an equation for the budget line.
B. Elucidate the consumers opportunity set in a diagram.
c. Show how the consumer opportunity set changes when the price of good x increases to $10. How does this change alter the market rate of substitution between goods x and y?
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Illustrate what is true about the prices they are able to charge and their revenue if they try to practice second degree price discrimination as the Bills did.
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