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Ted has the utility function U




07(i) Ted has the utility function U(x,y) = x(y + 1). The price of x is $2, the price of y is $1, and his income is $10.;a. Find Ted?s demand functions for x and y.;b. How much of each good does Ted demand?;c. If Ted?s income doubles, while prices remain unchanged, will Ted?s demand for both goods double?;d. Are Ted?s preferences convex? Show whether they are or not.


Paper#28029 | Written in 18-Jul-2015

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