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Unformatted text preview: Economics 11, Winter 2010; HW Assignment #023 Due Thursday Jan 28, 3:15PM in Lecture 1. For the quasi-linear utility function U ( x,y ) = x + y 1 / 2 find the demand functions X ( p x ,p y ,M ) and Y ( p x ,p y ,M ) (as functions of prices and income). Be careful about corner solutions! 2. For the Cobb-Douglas utility function U ( x,y ) = xy 3 (a) Find the demand functions X ( p x ,p y ,M ) and Y ( p x ,p y ,M ) (as functions of prices and income). (b) Sketch the own price demand curve for X (i.e., demand for X as a function of its own price p x ). (c) Sketch the other price demand curve for Y (i.e., demand for Y as a function of the other price p x ). (d) Sketch the income expansion path when p x = 1 ,p y = 2. You may use shortcuts but DO NOT simply plug into the formula and sketches from lecture. 3. For the CES utility function U ( x,y ) =- 1 x- 1 y (The signs are as intended. Notice that utility is negative but increases when x,y increase.) (a) Find the demand functions X ( p x ,p y...
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This note was uploaded on 04/01/2010 for the course ECON 180052110 taught by Professor Mcdevitt during the Winter '09 term at UCLA.
- Winter '09