Homework3

# Homework3 - W3211 Spring 2009 Professor Vogel Homework#3...

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W3211 Spring 2009 Professor Vogel Homework #3: Due Tuesday 02/24/09 Please write your name on the top of every page of your homework (in case they get separated) and please staple all pages together . Where appropriate, you must show all work. If you just give an answer without work, U ( x; y ) = 1 (1 ± ) 1 ± ± ² x y 1 ³ ± with 0 1 and 0 < ± < 1 \$ w > 0 . 1. (3 Points) If the price of x is \$ p x > 0 and the price of y is \$ p y > 0 demand function for x and his demand function for y (as functions of his wealth and math and you get it wrong, then you receive no partial credit.] 2. (12 Points) Substitute the demand curves you just solved for in Question #1 back the prices. Using this equation, determine if Bob is risk averse, risk neutral, or risk

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## This note was uploaded on 12/21/2009 for the course ECON 1211 taught by Professor Govel during the Spring '08 term at Columbia.

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Homework3 - W3211 Spring 2009 Professor Vogel Homework#3...

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