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c) Now suppose the utility function is given by U(c, L) = 2vc+2VL. Once again formulate and solve the utility-maximization problem and find the demand
c) Now suppose the utility function is given by U(c, L) = 2vc+2VL. Once again formulate and solve the utility-maximization problem and find the demand functions of (w, 1, I) and I* (w, 1, I). Then for- mulate the expenditure minimization problem and find the compensated demand functions c" (w, 1, U) and I (w, 1, U). Finally, combine these two demand functions to confirm that the Slutsky equation holds. (Caution: The final step of confirming the Slutsky equation involves a lot of algebra and can be skipped if you want.) d) Is leisure a Giffen good? In this case, could increasing wages explain why the employed are working fewer hours
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