Identify rosemarys optimal bundle on each budget

Reference no: EM133706566

Question: Suppose that Rosemary enjoys sugar in her coffee. She has very particular preferences, and she must have exactly two spoonfuls of sugar for each cup of coffee. Let C be the number of cups of coffee, and S be the number of spoonfuls of sugar. Rosemary's preferences can be represented by the utility function U(C, S) = MIN(2C, S).

Also, let PC be the price of a cup of coffee. Suppose Rosemary has $12 to spend on Coffee and Sugar. Also, the price of Sugar is $.10 per spoonful.

Graph Rosemary's Price consumption curve for prices, PC = $.40, PC = $.60, and PC = $.80. Please put the number of cups of coffee (C) on the horizontal axis, and the number of spoonfuls of Sugar (S) on the vertical axis. Be sure to graph each budget constraint associated with each price of Coffee, identify Rosemary's optimal bundle on each budget constraint, and make sure your graph is labeled carefully and accurately.

Reference no: EM133706566

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