Question: 1. Suppose Alma's preferences are given by the utility function U(q1,q2) = q2 + qlqz and faces the prices P1 > 0 and P2 >

1. Suppose Alma's preferences are given by the utility function U(q1,q2) = q2 + qlqz and faces the prices P1 > 0 and P2 > 0 a. Using the lagrangian approach derive expressions for Alma's Marshallian demand curves. Assume she has some level of Income I > 0. Given your answers to part (a), find expressions for the cross-price elasticity for each good and give the sign of your answers. Interpret your results. Now take the expressions you found in part (a) for (1:8; q; and plug them into the expression measuring utility and find the indirect utility function. [Ifyou set | = E, and solved for E, the resulting function is the expenditure function, E031, P2, (7).]

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