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. Max has the utility function U(x, y)x(y 1). The price of x is $2 and the price of y is $1. Income is
. Max has the utility function U(x, y)x(y 1). The price of x is $2 and the price of y is $1. Income is $10. How much x does Max demand? How much y? If his income doubles and prices stay unchanged, will Max's demand for both goods double?
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To determine how much of goods x and y Max demands and analyze the impact of a change in income we will use Maxs utility function the prices of goods ...
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Microeconomics An Intuitive Approach with Calculus
Authors: Thomas Nechyba
1st edition
538453257, 978-0538453257
