Ask a question
0 0

demand function and optimal demand involving total effect,income effect and substitution effect

mr hassan demand function for rice is given by x=15+m(10p)^-1.where x=amount of rice demanded,m=income of the consumer,p= price of rice.Orinally the income of mr hassan is 4800per month and the price of rice is 120per kg if the price falls to 100per kg,calculate the total effect,substitution effect and income effect emanating from this change in price.2.Given the following monotonically transformed utility function faced by the consumer,InU(X1X2)=@Inx1+BInx2,the price of good x1 is p1 and the price of goodx2 is p2.Derive the optimaldemand.

No answers ... yet!