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6. Lisa's marshallian demand functions are the following: Jr = 1 1 and gy = 21, and 3 PI 3 py 2/3 1/3 the hicksian
6. Lisa's marshallian demand functions are the following: Jr = 1 1 and gy = 21, and 3 PI 3 py 2/3 1/3 the hicksian demands are the following: hr = u (Py !) and hy = u Pa 2 Py The indirect utility function is: V(Px, Py, I) = I (3px) 1/3 ( 2 2/3 3py For a small change in Pr, use the Slutsky equation to find the substitution (SE) and income effects (IE) for good x? Hint: remember that TE = SE + IE (a) SE = - I 1/ IE = 9pa (b) SE = - I 3px 1/ IE = - 9p3 2 (C SE = - 21 9p2 1/ IE = I (d) SE = - 21 9p3 / / IE = -4 (e) None of them
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