Question: ( 1 5 points ) Suppose a consumer has the following utility over goods x and z : U ( q x , q z
points Suppose a consumer has the following utility over goods and :
Use this information to answer the following questions:
a point What is the constrained maximization problem?
b points What is the optimal choice for given income is good has a price of and good has a price of HintReminder: if have where and are both functions of then
c points Given you answer in part b and focusing on good what is the own price elasticity of demand, the crossprice elasticity of demand, and the income elasticity of demand? To make life easier ie to get specific values, use $$ and $
d marks
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