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Question 1 [word limit: 750] Suppose that the preferences of a consumer regarding the consumption of goods q, and q2 are represented by function: U(q1,
Question 1 [word limit: 750] Suppose that the preferences of a consumer regarding the consumption of goods q, and q2 are represented by function: U(q1, 92) = q1 95-a where q1 2 0, q2 2 0, 0 0 and faces prices p, and p2 respectively for goods q1 and q2.c. Consider now the dual problem. Specifically, minimise the expenditure function subject to the consumer achieving a level of utility u > 0 and derive the Hicksian demands for goods 91 and q2. Report and describe the expression of the minimised expenditure function. [15 marks]
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