dodoso33
Member
- Oct 9, 2012
- 38
- 11
In november 2012,every mzumbe university student had income of 150,000/= per month,facing the price of meal (x) 1000/= and average price of other goods (y) 1000/=.the initial utility maximizing quantities were, (x,y) : (75,75). In july 2011,the price of meal increased to 1500/= while the average price of other goods remained unchanged. The new utility maximizing quantities were (50,75). Attempt the following questions.
A )to maintain utility constant an income adjustment brought the studemt to consume the basket (61,92). What are the income and substitution effects?
B )suppose the oblective is to maintain purchasing power constant. Will utility be maximized?
C )in october 2011,the high education students loan board (heslb) increased the allowance to 7500/=per day. Is this amount worth?
A )to maintain utility constant an income adjustment brought the studemt to consume the basket (61,92). What are the income and substitution effects?
B )suppose the oblective is to maintain purchasing power constant. Will utility be maximized?
C )in october 2011,the high education students loan board (heslb) increased the allowance to 7500/=per day. Is this amount worth?