Question
The utility function of the consumer is U=2x^0.6 y^0.4. Her income is 7700 which she spends on products X and Y the price of product
The utility function of the consumer is U=2x^0.6 y^0.4. Her income is 7700 which she spends on products X and Y the price of product X is 308 and the price of products Y is 88 Determine the optimal consumption bundle The price of product Y decrease by 65% determine the optimal consumption bundle Compute the price elasticity of good Y by the average arc elasticity form. Interpret the result.
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Economics for Managers
Authors: Paul G. Farnham
3rd edition
132773708, 978-0133561128, 133561127, 978-0132773706
