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45. Jane receives utility from days spent traveling on vacation domestically (D) and days spent traveling on vacation in a foreign country (F), as given
45. Jane receives utility from days spent traveling on vacation domestically (D) and days spent traveling on vacation in a foreign country (F), as given by the utility function U(DE) = 10DF. In addition, the price of a day spent traveling domestically is $100, the price of a day spent traveling in a foreign country is $400, and Jane's annual travel budget is $4000. C. (4 points) What is the value and interpretation of the Lagrange multiplier for this problem? D. (4 points) How much utility is attained with the original utility maximizing amounts of foreign and domestic travel? | E. (8 points) Suppose that the price of domestic travel now increases to $200 per day with the price of foreign travel and income constant. Find the new utility maximizing amounts of foreign and domestic travel. (You need not use the Lagrangian method) F. (10 points) Determine the decomposition basket for the substitution effect due to the change in the price of domestic travel
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