Anna has utility U=A+2B, where A is the number of apples they eat and B is the number of bananas. a. Sketch 4 of Anna’s indifference curves. b. If Anna has a fruit budget of $10, and apples and bananas each cost a dollar, what will they buy? Illustrate graphically and explain in words. c. If apples go on sale 3 for a dollar, what will Anna buy? Illustrate graphically and explain in words.

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Revealed Preferences and Budget Constraint Analysis

Revealed means “Let Out,” and Preference means “Choice”; Choice Reveals Preference.