1-26-09 - UTILITY MAXIMIZATION BUDGET CONSTRAINT • Each...

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Microeconomics – Class Notes – 1/26/09
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Luxury goods when the income elasticity is greater than 1 Normal goods when the income elasticity is less than 1, but greater than 0 LOOK THE FOLLOWING UP: Inferior? Complementary? Substitutes?
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TAXES
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NEXT CHAPTER….
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Unformatted text preview: UTILITY MAXIMIZATION BUDGET CONSTRAINT • Each higher indifference curve represents higher and higher (more) utility (happier). 1. Budget constraint 2. Point of tangency between budget constraint and indifference curve....
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1-26-09 - UTILITY MAXIMIZATION BUDGET CONSTRAINT • Each...

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