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Slender Jack, vegetarian that he is, continues to consume apples and bananas. His utility function is (, ) = where xA and xB denotes consumption
Slender Jack, vegetarian that he is, continues to consume apples and bananas. His utility function is (, ) = where xA and xB denotes consumption for apples and bananas respectively. The unit price per apple is R1 and per banana is R2, while Jack's income is R40 per week. The price per banana suddenly falls to R1. Jack's demand for apples is (, ,) = 2 and for bananas is (, ,) = 2. Derive, using appropriate mathematical techniques, the Slutsky income effect and substitution effect of the price change from the demand functions provided. Based on your findings, identify the type of good
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