Let the utility function be given by
u(x1, x2) = √x1 + x2.
Let m be the income of the consumer, p1 and p2 the prices of good 1 and good 2, respectively.
To simplify, normalize the price of good 1, that is p1 = £1.
(a) Write down the budget constraint and illustrate the set of feasible bundles using
(a) The budget constraint is a line, which shows all possible combinations of consumption of goods x1 and x2.