Question
A consumer's utility function is U(x,y) = 4x + 8y. The price of x is 97, the price of y is 32, and the consumer's
A consumer's utility function is U(x,y) = 4x + 8y. The price of x is 97, the price of y is 32, and the consumer's income is 502.
Assume that the price of y changes to 41.Applying the Slutsky decomposition, what is the income effect of this price change on product y?
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Macroeconomics Principles And Policy
Authors: William J. Baumol, Alan S. Blinder
11th Edition
0324586213, 978-0324586213
