Question

U(x, y) = x,"x:(1-2) a. Solve for the marshallian demands for x, and x, as functions of p1, P2, and m. (Hint your solutions will be equations, not numbers). b. For x, find the own-price elasticity and income elasticity. C. Suppose a = 0.2, m = 100, p1 = 2, and p2=8, find the quantities of x, and X d. What happens to these quantities when p1 doubles to $4? e. What does this say about the price consumption curve (PCC)?

Answer 1

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