Question 1 (Market Demand) Suppose there are three consumers for good X. For each of the...
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Question 1 (Market Demand) Suppose there are three consumers for good X. For each of the following consumers, find the demand curve (x expressed as a function of px. This is same as saying find the Marshallian demand and plug in I). You can use the Cobb-Douglas formula. (a) Consumer 1 with the utility function U(x, y) = x0.5y0.5 and income I = 100. (b) Consumer 2 with the utility function U(x, y) = x0.3 y0.7 and income I = 200. (c) Consumer 3 with the utility function U(x, y) = xº.6y0.4 and income I = 150. Now, find the market (aggregate) demand for good X by summing up the x's you found. (d) Find the market demand curve (Qp as a function of px). Question 1 (Market Demand) Suppose there are three consumers for good X. For each of the following consumers, find the demand curve (x expressed as a function of px. This is same as saying find the Marshallian demand and plug in I). You can use the Cobb-Douglas formula. (a) Consumer 1 with the utility function U(x, y) = x0.5y0.5 and income I = 100. (b) Consumer 2 with the utility function U(x, y) = x0.3 y0.7 and income I = 200. (c) Consumer 3 with the utility function U(x, y) = xº.6y0.4 and income I = 150. Now, find the market (aggregate) demand for good X by summing up the x's you found. (d) Find the market demand curve (Qp as a function of px).
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Taxes and Business Strategy A Planning Approach
ISBN: 9780132752671
5th edition
Authors: Myron Scholes, Mark Wolfson, Merle Erickson, Michelle Hanlon
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