Essay
Assume that the budget constraint in Figure 7.1 panel A is: PEE +PAA = I,where I is total income and PE is the price of education and PA is the price of all other goods.If U(E,A)= A+E,PE = 2,PA = 1,and I = 10 what is the quantity of education and all other goods consumed?
-If the price of education drops to 1,how much of the two goods are consumed now?
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