Question: 5.7 Suppose the utility function for goods x and y is given by 5.8 utility U(x, y) xy+y. a. Calculate the uncompensated (Marshallian) demand functions

5.7 Suppose the utility function for goods x and y is given by 5.8 utility U(x, y) xy+y.

a. Calculate the uncompensated (Marshallian) demand functions for x and y and describe how the demand curves for x and y are shifted by changes in I or the price of the other good.

b. Calculate the expenditure function for x and y.

c. Use the expenditure function calculated in part

(b) to compute the compensated demand functions for goods x and y. Describe how the compensated demand curves for x and y are shifted by changes in income or by changes in the price of the other good.

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