Question
David consumes pizza and hamburgers and his utility function is given by: (, ) = 2 + . Initially, = 6, = 2, and m
David consumes pizza and hamburgers and his utility function is given by: (, ) = 2 + . Initially, = 6, = 2, and m = 6 (income). Then the price of pizza falls to = 2, but the price of hamburgers remains the same as does income (at = 2 and m = 6). What are the NUMERIC VALUES for the Hicks income and substation effects for PIZZA and HAMBURGERS when the price of pizza falls from 6 to 2?
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Economics Principles and Policy
Authors: William J. Baumol, Alan S. Blinder
12th edition
978-0538453677, 538453672, 978-0538453622, 538453621, 978-0538453653
