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Question3 Imagine an economy with only two goods: pizza and pasta. If pizza is represented by 2, and pasta is represented by y, and
Question3 Imagine an economy with only two goods: pizza and pasta. If pizza is represented by 2, and pasta is represented by y, and the utility function is a standard CES function: U(x, y) = (ax +Bye) Suppose that a, >0, a +8=1,p> 0 the price of pizza is P per slice, the price of pasta is Pu, and your income is I. a) Calculate Marshallian Demand for pizza b) Calculate Marshallian Demand for pasta c) Calculate Hicksian Demand for pizza d) Calculate Hicksian Demand for pasta
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Microeconomics Principles, Problems and Policies
Authors: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn
20th edition
978-0077660819, 77660811, 978-1259450242
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