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An Individual consumes good X1 and X2. Utility function is U (X1, X2) =min(X1,X2)+3max(X1,X2) Let W be the wealth of the individual and P1>0, P2>0
An Individual consumes good X1 and X2. Utility function is U (X1, X2) =min(X1,X2)+3max(X1,X2)
Let W be the wealth of the individual and P1>0, P2>0 be the prices of the goods. Provide a real life example of two goods X1 and X2 that satisfy it, draw the indifference curves, determine whether preferences are convex, strictly convex or neither, and compute the Walrasian demand, indirect utility function, Hicksian demand, and Expenditure function.
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