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Compute the market demand function (as a function of prices and incomes y) corresponding to a Leontev utility function with coefficients a=5 and b=1. What
Compute the market demand function (as a function of prices and incomes y) corresponding to a Leontev utility function with coefficients a=5 and b=1. What are the demands at prices p1=p2=1 and income y=20? Suppose the price of good 1 rises to 4. CXompute the price effects, substitution effects and income effects of the two goods. Explain the results.
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