U(x, y) = x,"x:(1-2) a. Solve for the marshallian demands for x, and x, as functions...
U(x, y) = x1ax2(1-a) a. Solve for the marshallian demands for x1 and x2, as functions of p1, p2, and m. (Hint: your solutions will be equations, not numbers). b. For x1 find the own-price elasticity and income elasticity. c. Suppose a = 0.2, m = 100, p1 = 2, and p2=8, find the quantities of x1 and x2. d. happens to these quantities when p1 doubles to $4? e. What does this say about the price consumption curve (PCC)?
U(x, y) = x1ax2(1-a) Solve for the marshallian demands for x1 and x2, as functions of p1, p2, and m. (Hint: your solutions will be equations, not numbers). For x1 find the own-price elasticity and income elasticity. Suppose a = 0.2, m = 100, p1 = 2, and p2=8, find the quantities of x1 and x2. What happens to these quantities when p1 doubles to $4? What does this say about the price consumption curve (PCC)? 2. Suppose the price...
Show all work please.
1. U(x, y) x,ax,1-a) a. Solve for the marshallian demands for x, and x2, as functions of p1, p2, and m. (Hint: your solutions will be equations, not numbers). (4pts) b. For x, find the own-price elasticity and income elasticity. (4pts) c. Suppose a = d. What happens to these quantities when p1 doubles to $4? (4pts) e. What does this say about the price consumption curve (PCC)? (4pts) 100, p1 2, and p2=8, find the...
NEED Question #2 1. U(x, y) = x1ax2(1-a) a. Solve for the marshallian demands for x1 and x2, as functions of p1, p2, and m. (Hint: your solutions will be equations, not numbers). b. For x1 find the own-price elasticity and income elasticity. c. Suppose a = 0.2, m = 100, p1 = 2, and p2=8, find the quantities of x1 and x2. d. What happens to these quantities when p1 doubles to $4? e. What does this say about...
7. Suppose U(X., X) = X.-X, (12pts) a. Solve for the marshallian demands for x, and X, as functions of p1, p2, and m. b. Is this an interior or corner solution? C. Is the budget exhausted here? Yes/no d. Assume that the above prices and income have all doubled. How does this change your solution in a?
1. Suppose U(X1, X2) = 2lnx, + 3lnx, and P, = 4, P2 = 1, and m = 20. (15pts) a. Solve for the Utility maximizing amounts of x, and X2. b. Is this an interior or corner solution? c. Is the budget exhausted here? Yes/no d. Assume that the above prices and income have all doubled. How does this change your solution in a? e. Set up the Lagrangian for this problem (but do not solve it) 2. Suppose...
Q2 For each of the following utility functions, derive the consumer's Marshallian demand functions, 21(P1, P2, B) and x (P1, P2, B), and calculate 11 (income elasticity of good 1), €1 (own-price elasticity of good 1), and €12 (cross-price elasticity). a U(x1, x2) = 21 b U(x1, x2) = 2.925-a for a € (0,1) CU(21, 12) = ln(21) + x2 where B > P2.
All you need to worry about is solving for the Marshallian
Demand Functions for both questions. I'm okay w/ deriving MDFs for
Cobb-Douglas functions and Leontief functions, but #3 (Quasilinear)
and #4 (Linear) I struggle with. Explain the steps if possible
3. Lady Marchmain has the following utility function over bread (b) and housing (h): Let Y denote Lady Marchmain's total income; let Po denote the price of bread; and let Ph denote the price of housing. a. Solve for...
The utility function is u = x1½ + x2, and the budget constraint is m = p1x1 + p2x2. Derive the optimal demand curve for good 1, x1(p1, p2), and good 2, x2(m, p1, p2). Looking at the cross price effects (∂x1/∂p2 and ∂x2/∂p1) are goods x1 and x2 substitutes or complements? Looking at income effects (∂x1/∂m and ∂x2/∂m) are goods x1 and x2 inferior, normal or neither? Assume m=100, p1=0.5 and p2=1. Using the demand function you derived in...
8. Edna's preferences over romantic comedes zı and horror flicks z2 is given by u =エ122, which implies MU = z2 and MUr2 = zł. The prices of each are P1 and P2 per movie. Edna's monthly budget for movies is n (a) Solve algebraically for Edna's ordinary demand for romantic comedies P,2,) and for horror flicks = z2(P1,P2, m). The equations to be solved include丑= PL and m = p12 1 +P2X2. エ1 l mark (b) Evaluate these at...