Unformatted text preview: b) How many dresses and hats is she going to consume? (Hint: the first order conditions will not help; draw the budget constraint and the indifference curves and look at the highest one that intersects the budget constraint) c) What is Britney’s indirect utility? 4) Suppose that an individual with income I cares about two goods, X and Y. The price of the two goods is P x and P Y . The individual has the following utility function: 1 , Y X Y X U a) Find the Marshalian(uncompensated) demand for X and Y. b) Find the Hicksian (compensated) demand for X and Y. c) Find the indirect utility of this individual in terms of prices and income. d) Find the expenditure function in terms of level of utility and prices....
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- Fall '07
- Economics, following utility function, Britney