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A consumer has utility function U X,Y XYwhich she maximizes subject to the budget constraint pxX pyY M Find the ordinary demand function for good Y Suppose a new constraint is now imposed such

A consumer has utility function U X,Y XYwhich she maximizes subject to the budget constraint pxX pyY M Find the ordinary demand function for good Y Suppose a new constraint is now imposed such

A consumer has utility function U(X,Y)=XYwhich she maximizes subject to the budget constraint pxX+pyY=M. (a) Find the ordinary demand function for good Y. Suppose a new constraint is now imposed such that Y>_3X. (b) Find the optimal choice of the consumer with the additional constraint.(c) Find the condition required for the second constraint to be binding. Illustrate your answer diagrammatically.

abhinav behal 11-May-2020

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