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thanks in advance For the next two questions of this problem, consider a general utility function u : R' - R, ($1, 12) > u(11,

thanks in advance

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For the next two questions of this problem, consider a general utility function u : R' - R, ($1, 12) > u(11, 12) satisfying the usual assumptions economists make. Assume that the associated Marshallian demand function is different tiable with respect to prices and income and that the compensated demand function is differentiable with respect to prices. (g) The motivation that is commonly given for studying income and sub- stitution effects is that it helps understand the possibility of a Giffen good. Using the Slutsky equation, explain the connection between Gif- fen goods and inferior goods. In particular, which of the following two statements is necessarily true and which one is not always so? Why? (i) A Giffen good is an inferior good; (ii) An inferior good is a Giffen good

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