Problem: Give typed solution
Bobby who has preferences over candy (C) and dessert (D):
U (C, D) = 3C + 4D
The price of candy is $4 and the price of dessert is $1. Bobby has $12 to spend on this choice occasion.
(a) How many candies will Bobby buy? How many desserts will Bobby buy? Label them C∗and D∗
(b) Show this solution graphically (label C∗and D∗, the IC at the optimum, and the budget line).