Suppose David spends his income (I) on two goods, x and y, whose market prices are px and py, respectively. His preferences are represented by the utility 1 2 function u(x, y) = Inx + 2lny (MUx = MUy x =). a. Derive his demand functions for x and y. Are they homogeneous in income and prices? b. Assuming I = $60 and px = $1, graph his demand curve for y. c. Repeat part (b) for the case in which px = $2

Suppose David spends his income (I) on two goods, x and y, whose market prices are px and py, respectively. His preferences are represented by the utility 1 2 function u(x, y) = Inx + 2lny (MUx = MUy x =). a. Derive his demand functions for x and y. Are they homogeneous in income and prices? b. Assuming I = $60 and px = $1, graph his demand curve for y. c. Repeat part (b) for the case in which px = $2

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter10: Consumer Choice Theory

Section: Chapter Questions

Problem 6P

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not use ai please

Suppose David spends his income (I) on two goods, x and y, whose market
prices are px and py, respectively. His preferences are represented by the utility
1
2
function u(x, y) = Inx + 2lny (MUx
=
MUy
x
=).
a. Derive his demand functions for x and y. Are they homogeneous in
income and prices?
b. Assuming I = $60 and px = $1, graph his demand curve for y.
c. Repeat part (b) for the case in which px = $2

Definition Definition Structural system an enterprise uses to collect, store, report, retrieve, and process financial data. Accounting information systems are used by business analysts, auditors, accountants, and consultants for accurate and efficient access to financial data.

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