please only do: if you can teach explain steps A consumer of two goods has Hicksian demand(h₁ (p, u), h₂(p, u)) = (u, 2u).(a) Find the Marshallian demand.Solution: The expenditure function is given byTherefore,e(p, u) = p.h(p,u) = p₁u+2p₂u.Using the identity e(p, v(p, w)) = w, we obtainv(p, w) ==x(p,w) = h(p, v(p, w))WP₁+2p₂=W2wP₁+2p2 P1+2p2/(b) Suppose prices change from (2, 1) to (2, 3), and, at the same time, wealth changes from6 to 10. Calculate the equivalent variation associated with this change.Solution: The equivalent variation is102+2.3e ((2, 1), v((2, 3), 10) - 6 = (2+2-1);= -1.6

In microeconomics, a consumer's amount desired is part of the answer to reducing his spending on all…

A consumer of two goods has Hicksian demand (h₁ (p, u), h₂(p, u)) = (u, 2u). (a) Find the Marshallian demand. Solution: The expenditure function is given by e(p,u) = p.h(p, u) = p₁u+2p₂u. Using the identity e(p, v(p, w)) = w, we obtain W

A consumer of two goods has Hicksian demand (h₁ (p, u), h₂(p, u)) = (u, 2u). (a) Find the Marshallian demand. Solution: The expenditure function is given by e(p,u) = p.h(p, u) = p₁u+2p₂u. Using the identity e(p, v(p, w)) = w, we obtain W

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose you have the following indirect utility function: V(Pa, Py, I) = In PxPy What are marshallian demands for x and y? I (a) (9x9y) = (22) (b) (9,9y) = (In, In 2) (c) (9, 9y) = (exp(2p/py), exp(2ppy)) I (d) (9x, gy) = (2pr+py' px+2py) What is the expenditure function for the associated expenditure minimization problem? (a) E(pa, Py, U) = (P + Py) ln(U) (b) E(pa, Py, U) = √exp(U)Papy (c) E(pa, Py, U)= (p²+p²) In(U) (d) E(pa, Py, U) = exp(U)²papy What are the individual's Hicksian demands for goods x and y? (a) (h₂, hy) = ((BU)¹/², (PU) ¹/²) (b) (ha, hy) = (RU, DU) (c) (ha, hy) = ((2 exp(U))¹/², (exp(U))¹/²) -1/2 (d) (hx, hy) = ((P₂PzU)−¹/², (P₂PzU)-¹/2) Are x and y complements or substitutes?
Suppose an individual has preferences over goods x and y, and their expenditure minimization problem has the following expenditure function: E(px, Py, U) = (px + 3p,)U. What is the person's Hicksian demand? O(h, hy) = (2p U, pU) O(h, hy) = (U, 3U) O(h, hy) = (Up,',Up,) O(hx, hy) = (3U, U) What is the individual's indirect utility? OV = 3p! p OV = P.+3p, OV = P Py OV = P.P
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