The consumer's utility function is the following: U=x + 10x0,6 1 The consumer's optimal values of x and x are the given by the following: x 1 2 P 6P 2 +9 P P P 1 1 The compensated demand equations for x and x are the following: x₁=U-10 1 2 6P 0.6 P 2 1 2 1-0.6 1-0.6 x2c Assume the prices are the following: P₁=1, P₂=1, I=10000, and the P₁ that makes x=0 is P₁=16.732. 1 What is the consumer surplus? = - = 6P 1 P 2 6P 1 P 2 1-0.6 1-0.6

The consumer's utility function is the following: U=x + 10x0,6 1 The consumer's optimal values of x and x are the given by the following: x 1 2 P 6P 2 +9 P P P 1 1 The compensated demand equations for x and x are the following: x₁=U-10 1 2 6P 0.6 P 2 1 2 1-0.6 1-0.6 x2c Assume the prices are the following: P₁=1, P₂=1, I=10000, and the P₁ that makes x=0 is P₁=16.732. 1 What is the consumer surplus? = - = 6P 1 P 2 6P 1 P 2 1-0.6 1-0.6

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter3: Supply And Demand: Theory

Section: Chapter Questions

Problem 22QP

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