Derive the hicksian demand function using indirect utility , Mathematics

Assignment Help:

(a) Derive the Marshalian demand functions and the indirect utility function for the following utility function:

u(x1, x2, x3) = x1 1/6 x2 1/6 x3 1/6    x1≥ 0, x2≥0,x3≥ 0

 [Hint: Try to make use of your results from problem 3 in Assignment 1 instead of redoing all the calculations here.]

(b) Using the indirect utility function that you obtained in part (a), derive the expenditure function and from it, derive the Hicksian demand function for good 1.

(c) Jack and his grandfather are sitting at the dinner table, discussing their lives. Both share the same utility function as given in part (a). Jack is boasting about his $5000 a month salary, with per-unit prices of x1, x2 and x3 being $4, $4 and $16 respectively. Jack's grandfather claims that the old days were much better because although his salary was $500 a month, the per-unit prices of x1, x2and x3 were all only $1. Do you agree with his grandfather?

 


Related Discussions:- Derive the hicksian demand function using indirect utility

Measurements, 2feet wide and 12 feet long.tile is 2feet wide and 1.5feet lo...

2feet wide and 12 feet long.tile is 2feet wide and 1.5feet long.how many tiles do I need

Integers, The Dolphins football team gained 16 yards on their first play th...

The Dolphins football team gained 16 yards on their first play then lost 11 yards on the next play. Write an addition expression to represent this situation.Find the sum an explain

Elimination technique of linear equations, What is the Elimination techniqu...

What is the Elimination technique of Linear Equations?

The square of a positive number is 49 what is the number, The square of a p...

The square of a positive number is 49. What is the number? Let x = the number.  The sentence that is , "The square of a positive number is 49," translates to the equation x 2

Allied mathematics, The tenth term in the binomial expansion of (1-1/4)(1-1...

The tenth term in the binomial expansion of (1-1/4)(1-1/5)(1-1/6)...(1-1/n+3) is equal to

Percentage change, in a sale a clothes shop reduces its prices by 30% a shi...

in a sale a clothes shop reduces its prices by 30% a shirt usually costs £38 how much is it in the sale

What is the average of his four quiz grades, Andy earned the subsequent gra...

Andy earned the subsequent grades on his four math quizzes: 97, 78, 84, and 86. What is the average of his four quiz grades? To ?nd out the average, you must add the items (97

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd