Question
1. [10 Points] The preferences of a consumer are represented by the following utility function: U=xx. If income is 100 and p, p =
1. [10 Points] The preferences of a consumer are represented by the following utility function: U=xx. If income is 100 and p, p = 1, a) What is the optimal bundle? = b) If p, 4, what is the new optimal bundle? c) Decompose the price effect into income and substitution effect. d) Provide a graphical representation of your results.
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Principles of Cost Accounting
Authors: Edward J. Vanderbeck, Maria Mitchell
17th edition
9781305480520, 1305087402, 130548052X, 978-1305087408
