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2. Picture yourself at 6 years old, walking into a candy shop to buy yourself some candy. You have I dollars in hand, and will
2. Picture yourself at 6 years old, walking into a candy shop to buy yourself some candy. You have I dollars in hand, and will spend all of it to buy as much candy as you want. The store sells two options Twix (at JpnG dollars per unit) and Hershey's bars (at pg per unit). Your Marshallian demand for Twix is given by the function m I II: (PmPyaI) = g and your Marshallian demand for Hershey's is given by 21' ymwmipy51)= $- y Recall that sum here is not '9: to the power m' but simply the Marshallian demand for m (Twix). The 'm' is just a label. Select the correct choices for the statements below: (a) From the demand functions above, we see that gig is i. positive ii. negative iii. zero. (b) Thus the demand function tells us that if the price of Hershey's bars increase, you will buy: i. More Hershey's bars ii. Fewer Hershey's bars iii. The same amount. 6:3\" 619.9. (c) Looking now at the demand for Twix, we see that is i. positive ii. negative iii. zero. (d) Thus the demand function tells us that if the price of Hershey's bars increase, you will buy: i. More Twix ii. Less Twix iii. The same amount of Twix. The partial derivative gag gives the rate of change of the Marshallian demand for Y relative to the price of Y. We call this the price eect of Y on y\". Similarly % gives the price effect of Y on 53'\". y
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