1
answer
0
watching
44
views
8 Jun 2019

Jill buys two goods: X and Y and has the following utility function: U(X,Y) = 2X0.25Y0.75

a. Find the equation for her generalized demand curve for X*(Px,Py,I)

b. Find the equation for her generalized demand curve for Y*(Py,Px,I)

c. Are the above generalized demand functions homogeneous of degree 0? (Show your work)

d. Is X a normal good?

e. Is X a gross substitute or complement to Y?

f. Find the compensated demand curve for Xc(Px, Py, U)

g. Find the compensated demand curve for Yc (Py, Px, U)

h. Are the compensated demand functions homogenous of degree 0 in Px and Py if utility is held constant?

i. Find the expenditure function: E(Px, Py, U)

j. Use Shephard’s Lemma to verify that your compensated demand functions Xc and Yc are correct.

k. Find the indirect utility function: V(Px,Py,I)

For unlimited access to Homework Help, a Homework+ subscription is required.

Casey Durgan
Casey DurganLv2
9 Jun 2019

Unlock all answers

Get 1 free homework help answer.
Already have an account? Log in

Related textbook solutions

Related questions

Related Documents

Weekly leaderboard

Start filling in the gaps now
Log in