6.1 Heidi receives utility from two goods, goat’s milk (m) and strudel (s), according to the utility function Uðm, sÞ ¼ m & s:

a. Show that increases in the price of goat’s milk will not affect the quantity of strudel Heidi buys; that is, show that @s/@pm ¼ 0.

b. Show also that @m/@ps ¼ 0.

c. Use the Slutsky equation and the symmetry of net substitution effects to prove that the income effects involved with the derivatives in parts

(a) and

(b) are identical.

d. Prove part

(c) explicitly using the Marshallian demand functions for m and s.