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Unformatted text preview: the income effect on Y when the price of Y increases from $1 to $4? Instructions: Enter the absolute value. 3 What is Esther's compensating variation for the price change? Instructions: Enter your answer as a whole number. $24 Worksheet Section: Dissecting the Effects of a Price Change Esther consumes goods X and Y, and her utility function is
http://e z to.mhe c loud.mc gr a w- hill.c om/hm.tpx? todo= pr intvie wSingle 2/5 1/22/2014 Assignme nt Pr int Vie w For this utility function, a. What is Esther's MRSXY?
Y/(X + 1) True or false? Her preferences satisfy the declining MRS property.
b. Suppose her daily income is $20, the price of X is $4 per unit, and the price of Y is $1 per unit. What is her
best choice? Instructions: Enter your answers as whole numbers. X = 2 Y = 12 What is Esther's utility when her daily income is $20, the price of X is $4 per unit, and the price of Y is $1 per
unit? Instructions: Enter your answer as a whole number. 36 What is the (own) price elasticity...
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- Fall '13