This preview shows page 1. Sign up to view the full content.
Unformatted text preview: = 2. What is an indirect or value function? (you can use the notation in 1. to explain if you wish) If x 1 * and x 2 * satisfy the first order conditions, the indirect or value function is * * 1 2 ( , , ). f x x z Example. In the example * 1 500 , x z = and * 2 100. x = The indirect or value function is 2 2 100 (500 ) .1(500 ) 200(100) 1(100) y z z z =+...
View
Full
Document
This note was uploaded on 04/07/2011 for the course ECON 380 taught by Professor Showalter,m during the Winter '08 term at BYU.
 Winter '08
 Showalter,M
 Economics

Click to edit the document details