Business, 09.10.2019 17:10, Mypasswordishotdog11
Suppose we have 2 goods, x1 and x2, with respective prices p1 and p2. sam has income m. sam’s demand function for good x1 is given by: x1(p1,p2,m) = p2m - p21 (a) given the above demand function, graphically depict how we would derive sam’s engel curve from the income consumption curve (just give a rough sketch like the ones done in the lecture notes). (b) are goods x1 and x2 substitute goods? explain. (c) now suppose p2 = 5 and m = 10. there are 20 consumers in the market and all consumer’s have identical demand functions. what is the market demand function. (d) find the price elasticity of market demand if p1 = 3. (e) given the price elasticity of demand you calculated in part d), is good 1 an ordinary good or a giffen good? explain.
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Suppose we have 2 goods, x1 and x2, with respective prices p1 and p2. sam has income m. sam’s demand...
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