Utility is maximised when

so Substituting this into the B.C which is

,

So Y can be calculated using and substituting into the B.C, or solving MRS equal to the price ratio for X.

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- February 11th 2010, 11:10 AM #1

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- February 11th 2010, 03:48 PM #2

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- February 13th 2010, 03:59 AM #3

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