If U = a(XY), money income is 656 per week, P = 8, calculate the demand function for Y
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1 mark, −0.33MicroeconomicsBudget constraint and consumer equilibriumUtility maximisation and the interior optimumModerateabout 1 min
UoH 2010 Question 21: Budget constraint and consumer equilibrium
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If U = a(XY) ^(1/2), money income is 656 per week, P ₓ = 8, calculate the demand function for Y (A) 328/P _y (B) 168/P _y (C) 316/P _y (D) 350/P _y
Also written as: If U = a(XY) ^(1/2), money income is 656 per week, P _x = 8, calculate the demand function for Y
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What this question tests
This question is on Utility maximisation and the interior optimum, part of Budget constraint and consumer equilibrium in Microeconomics.
Choosing the best affordable bundle where an indifference curve is tangent to the budget line, including Cobb-Douglas demand.
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