3. Suppose a consumer has the utility function U(q2, q,) = In(q)+ 2qy. Let price of...

 

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3. Suppose a consumer has the utility function U(q2, q,) = In(q±)+ 2qy. Let price of good x be Pa, the price of good y be P, and income be Y. (a) (4 marks) Find the Engel Curve of good r and good y. Make sure to label the axes and curves. (b) (4 marks) Find the expenditure function. Show Shephard's Lemma gives that same demand curve for good z (i.e. you get the same demand for good z using aE(P, Py,U). the Lagrangian/Substitution Method/Short Cut Method and aP 3. Suppose a consumer has the utility function U(q2, q,) = In(q±)+ 2qy. Let price of good x be Pa, the price of good y be P, and income be Y. (a) (4 marks) Find the Engel Curve of good r and good y. Make sure to label the axes and curves. (b) (4 marks) Find the expenditure function. Show Shephard's Lemma gives that same demand curve for good z (i.e. you get the same demand for good z using aE(P, Py,U). the Lagrangian/Substitution Method/Short Cut Method and aP