your answer. 2. The utility function of a consumer over two goods x and y is given by u(x, y) = 20 ln x + 2y The price of y is 1. Let p denote the price of x. The consumer has an income of M> 10. The consumer's price elasticity of demand for x has a lower absolute value compared to the income elasticity of demand for y. Is this true or false? Explain by calculating both elasticities.

your answer. 2. The utility function of a consumer over two goods x and y is given by u(x, y) = 20 ln x + 2y The price of y is 1. Let p denote the price of x. The consumer has an income of M> 10. The consumer's price elasticity of demand for x has a lower absolute value compared to the income elasticity of demand for y. Is this true or false? Explain by calculating both elasticities.

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter5: Elasticity Of Demand And Supply

Section: Chapter Questions

Problem 8QFR

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Prove that price elasticity of demand is not the same as the slope of a demand curve.
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