Question: 2. For a consumer whose preferences are represented by the utility function u(x1, (2) = VX1 + x2 and a budget constraint pid1 + 12

2. For a consumer whose preferences are represented by the utility function u(x1, (2) = VX1 + x2 and a budget constraint pid1 + 12 = m how much income does she need to compensate for a doubling of pifrom 1 to 2. In this example p2 is always equal to 1. 3. Show that consumer demand functions are homogeneous of degree zero in incomes and prices

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