Illustrate what is the laspeyres price index

Assignment Help Macroeconomics

Reference no: EM1347835

1- Suppose X & Y are 1-2 perfect substitutes, i.e. the consumer's satisfaction from every unit of X is twice of a unit of Y. Suppose in 2009 , PX = 3, PY = 2 and the consumer income is $12. In 2010, PX = 2.5, PY = 1.

a) Write down the utility function.

b) What is the ideal price index?

c) Illustrate what is the Laspeyres price index?

d) Calculate ideal and Laspeyres indices if U(X, Y) = Min (2X, Y)

Reference no: EM1347835

Questions Cloud

Healthcare operations budget : Many areas should be considered when developing the healthcare operations budget. To accurately assess revenue and cost considerations, strategic forecasting should be performed. Each kind of healthcare business (i.e., hospital, health plan, facil..

Difference between motivation and manipulation : Motivation Versus Manipulation - Explain what is the difference between motivation and manipulation?

Illustrate ahat are the general equilibrium values : Illustrate ahat are the general equilibrium values of the real interest rate, price level, consumption, and investment.

Impact performance and commitment in the workplace : Examine how job satisfaction, stress, and motivation impact performance and commitment in the workplace.

Illustrate what is the laspeyres price index : Illustrate what is the Laspeyres price index. Calculate ideal and Laspeyres indices.

Finding the intrinsic value of debt : The futures markets have potentially unlimited risk for the speculators. If a speculator guesses wrong about the price direction of a commodity. Use valuation techniques to find the intrinsic value of debt and equity instruments

Program to produce ten random permutations of numbers : In C++(must be able to compile in Visual Studio ): Write a program to produce ten random permutations of numbers 1 to 10.

Different types of budgets : What are some of the different types of budgets? Explain in detail one kind of budget covered in the text. Explain what the budget is employed for and what information it provides the business.

Illustrate what it implies for the relationship : illustrate what it implies for the relationship between labour supply and productivity growth.

User Account

All Pages