Type only the answers, do not handwritten it. Answer only no. 2 1. Assume you spend your entire income on two goods X & Y with prices given as Px & Py,respectively. Prices and income (1) are exogenous and positive. Given that U =X² + Y°,derive the Marshallian demand function for good Y and evaluate the type of good.2. Assume you spend your entire income on two goods X & Y with prices given as Px & Py,respectively. Prices and income (I) are exogenous and positive. Given that U= X'Y',derive the Hicksian demand function for good Y.

We minimize the expenditure function given the utility and find the hicksian demand functions. We…

2. Assume you spend your entire income on two goods X & Y with prices given as Px & Py, respectively. Prices and income (1) are exogenous and positive. Given that U= X'Y', derive the Hicksian demand function for good Y.

2. Assume you spend your entire income on two goods X & Y with prices given as Px & Py, respectively. Prices and income (1) are exogenous and positive. Given that U= X'Y', derive the Hicksian demand function for good Y.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter12: The Partial Equilibrium Competitive Model

Section: Chapter Questions

Problem 12.3P

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Type only the answers, do not handwritten it. Answer only no. 2

1. Assume you spend your entire income on two goods X & Y with prices given as Px & Py,
respectively. Prices and income (1) are exogenous and positive. Given that U =X² + Y°,
derive the Marshallian demand function for good Y and evaluate the type of good.
2. Assume you spend your entire income on two goods X & Y with prices given as Px & Py,
respectively. Prices and income (I) are exogenous and positive. Given that U= X'Y',
derive the Hicksian demand function for good Y.

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