Over the past decade,medical costs have increased more rapidly than other prices.In order to illustrate how rising medical costs have affected consumer alternatives,let X represent the quantity of medical services,and let Y represent the quantity of other goods.Furthermore,let income (M)be measured in hundreds of dollars,the price of medical services and other goods in terms of dollars per minute,with M = 100,P_x = 4,and P_y = 5.
a.Graph the budget line,and determine the market rate of substitution.
b.Illustrate the budget set.
c.Show in your graph what happens to the budget constraint if P_x increases to $10.
d.What is the meaning of the slope of the two budget constraints?

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The Answer of Over the past decade,medical costs have increased more rapidly than other prices.In order to illustrate how rising medical costs have affected consumer alternatives,let X represent the quantity of medical services,and let Y represent the quantity of other goods.Furthermore,let income (M)be measured in hundreds of dollars,the price of medical services and other goods in terms of dollars per minute,with M = 100,P_x = 4,and P_y = 5. a.Graph the budget line,and determine the market rate of substitution. b.Illustrate the budget set. c.Show in your graph what happens to the budget constraint if P_x increases to $10. d.What is the meaning of the slope of the two budget constraints?

Over the Past Decade,medical Costs Have Increased More Rapidly Than