Asked by
sohan banerjee
on Oct 14, 2024Verified
Donald's utility function is U(x, y) x y1/2.Currently he is buying some of both goods.If his income rises and prices don't change, he will buy more of both goods.
Utility Function
This represents how consumer preferences can be quantified based on different levels of consumption of various goods and services.
Income Rises
An increase in the amount of money earned by an individual or household, which can affect consumption patterns and demand for goods and services.
- Analyze the impact of income changes on consumption patterns.
Verified Answer
SS
Learning Objectives
- Analyze the impact of income changes on consumption patterns.