1. a) Consider the case of a consumer with demands over two goods. Prove that it is not possible for both goods to be luxury goods.
b) Demonstrate with a well-labelled diagrammatic example that it is not in general possible to treat aggregate demand as a function of aggregate income. Be clear in your argument - do not simply slap down a picture.
As you can see there are two luxurious goods in the diagram, so it is not possible to both goods be the luxurious goods because:-
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