ECON 3710 Midterm: ECON 3710 Midterm Fall 2003
Document Summary
This midterm is worth 30% of your final mark. You have 80 minutes ---- j. atsu amegashie: jane has the utility function, uj = 2ln x + lny. Let her income be i and the prices of x and y be px and py. (i) (ii) Derive her marshallian demand functions for x and y. Find her optimal consumption bundle, if i = 100, px = 2 and py = 4. 3 marks (iii) ryan has the utility function ur = She has an income of 100 and faces a different set of prices; Px = 2 and py = 4 , where and are positive constants and > . Without solving his primal problem but using your results in (i) and (ii), determine if ryan consumes more or less x than jane. 10 marks: consider an individual who consumes only two goods, x and y. and her optimal consumption bundle is x = 10 and y = 10.
