There are two goods x and y. A consumer has utility function U(x, y) = min(2x, y). The price of good x is 2 and the price of good y is 1. The consumer has income I = 10. 1) Draw a graph that illustrates the indifference curves for the consumer. 2) Find the bundle of goods (x *, y*) that maximizes the consumer's utility subject to the budget constraint.

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Equilibrium Price and Quantity

Equilibrium refers to a state of balance that comes about because there is equality in all forces.