The utility function is U(x1, x2)= 3ln (x1)+ 5x2, the prices are p1 and p2, and income is y.Derive the ordinary demand functions for goods x1 and x2.Are goods normal? Explain.Are good substitutes? Are goods complements? Explain. The utility function is U(x₁, x₂)= 3ln (x1)+ 5x2, the prices are p₁ and p2, and income is y.a. Derive the ordinary demand functions for goods x1 and x2.b. Are goods normal? Explain.C. Are good substitutes? Are goods complements? Explain.

Utility function shows the relationship between the utility and consumption of goods x1 and x2.…

he utility function is U(x1, x2)= 3ln (x1)+ 5x2, the prices are p1 and p2, and income is y. Derive the ordinary demand functions for goods x1 and x2. Are goods normal? Explain. Are good substitutes? Are goods complements? Explain.

he utility function is U(x1, x2)= 3ln (x1)+ 5x2, the prices are p1 and p2, and income is y. Derive the ordinary demand functions for goods x1 and x2. Are goods normal? Explain. Are good substitutes? Are goods complements? Explain.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter4: Utility Maximization And Choice

Section: Chapter Questions

Problem 4.8P

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Question

The utility function is U(x1, x2)= 3ln (x1)+ 5_x2, the prices are p1 and p2, and income is y.

Derive the ordinary demand functions for goods x1 and x2.
Are goods normal? Explain.
Are good substitutes? Are goods complements? Explain.

The utility function is U(x₁, x₂)= 3ln (x1)+ 5x2, the prices are p₁ and p2, and income is y.
a. Derive the ordinary demand functions for goods x1 and x2.
b. Are goods normal? Explain.
C. Are good substitutes? Are goods complements? Explain.

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