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The consumer has preferences represented by the utility function u=x 1 a x 2 1-a . Find her indirect utility function. Confirm Roy's identity by:
The consumer has preferences represented by the utility function u=x1ax21-a . Find her indirect utility function. Confirm Roy's identity by: (a) differentiating the indirect utility function with respect to price of good 1. (b) using the first order conditions to obtain solutions for x1.
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