Question: Suppose L = 3 , and consider the demand function x ( p , w ) dened by x 1 ( p , w )

Suppose L =3, and consider the demand function x(p, w) dened by x1(p, w)= p2 p1+p2+p3 w p1 x2(p, w)= p3 p1+p2+p3 w p2 x3(p, w)= p1 p1+p2+p3 w p3(a) Does this demand function satisfy homogeneity of degree zero and Walras' law when =1? What about when in (0,1)?(b) Assume =1 and w =1. Compute the substitution matrix. Show that at p =(1,1,1), it is negative semidenite but not symmetric. (c) Show that this demand function does not satisfy the weak axiom.

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