Question
Consider this utility function: U=xy + y Confirm that the demand function for X=(1-Px)/2Px=(1/2Px)-1/2 Suppose the price of X is 25 and income decreases from
Consider this utility function: U=xy + y
Confirm that the demand function for X=(1-Px)/2Px=(1/2Px)-1/2
Suppose the price of X is 25 and income decreases from 1,000 to 990
a. Find the value of income elasticity for good X
b. What type of good is good X?
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Essentials of Economics
Authors: N. Gregory Mankiw
8th edition
1337091995, 978-1337515351, 1337515353, 978-1337091992
