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If Cobb- Douglas demand functions for x and y are given by x* = m/3p x and y* = 2m/3p y thensubstitution effect would cause
If Cobb- Douglas demand functions for x and y are given by x* = m/3pxand y* = 2m/3pythensubstitution effect would cause consumer to buy 12.5 more units of x ifpxfalls from $2 to $1, while income m and pyremains constant at $90 and $1 respectively.
Is this true or false? if false then why? explain briefly.
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