Question: A maximizing consumer with m = 1700 has utility u = y1/2h1/2 where y is spending on a composite commodity pY = 1 and h

A maximizing consumer with m = 1700 has utility u = y1/2h1/2 where y is spending on a composite commodity pY = 1 and h is the size of her apartment in square metres with p = 6 dollars per square metre. She must commute d = 100 kilometers per month to her place of employment. Commuting costs t = 5 per kilometer. a. Compare d = 100 Mississauga to rents for d = 40 Harbourfront (moving inward) and d = 160 Barrie (moving outward). b. Discuss Hicks (equilibrium) vs Slutsky (cost equivalent) and discuss "overstatement"

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