a. How to derive the input demand functions and contingent input demand functions and what are the main differences between them?

b. If the government first charge of a tax of 1 yuan per liter of gasoline, then make a tax rebate (exact same amount as paid tax) under form of income subsidy, how will this policy affect consumer's choice and will she be better-off or worse-off?

c. Suppose utility is given by U(x, y) = lnx + lny and px = 1, I = 10. If y must be purchased in whole units, what is the maximum price this person would pay for that good?

a.1 b. 5. c. 10. d. 20.

d. "Hicks' Second Law of Demand" states that "most" goods must be

a. gross substitutes. b. gross complements.

c. net substitutes. d. net complements.

e. Consider the production function

q=(k^a+l^a^

For this function to have diminishing marginal productivities and increasing returns to scale, it must be the case that

a. > 1 < 1. b. > 1 > 1.

c. < 1 < 1 d. < 1 > 1.