Essay
Suppose you solve a consumer's constrained 2-good optimization problem for a given economic environment --- and your answer contains a negative consumption level of good 2.Which of the following is a valid conclusion on your part:
a.
The true optimum has the consumer consume none of good 1.
b.
The true optimum has the consumer consume none of good 2.
c.
There are multiple "true" optimal consumption bundles.
d.
The consumer will sell good 2.
e.
None of the above.
Correct Answer:

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Correct Answer:
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The first order conditions identify ta...
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