Question Threea) Given two inputs X₁ and X₂ with Prices W₁ and W2, and a production function Y=F(X₁X₂) show that the marginal rate of substitution between the two inputs is equal to theratio of their prices.b) Discuss under what circumstances the Hicksian and Walrasian demand functions areequivalent.Question Foura) Discuss why anti-trust laws or competition laws are necessary in marketenvironments?b): Each one of two bars charges its own price for a beer, either $2, $4, or $5. Thecost of obtaining and serving the beer can be neglected. It is expected that 6000beers per month are drunk in a bar by tourists, who choose one of the two barsrandomly, and 4000 beers per month are drunk by natives who go to the bar withthe lowest price, and split evenly in case both bars offer the same price. Whatprices would the bars select

Hi there, following BNED guidelines we are only solving first question. Kindly repost the remaining…

a) Given two inputs X₁ and X₂ with Prices W₁ and W2, and a production function Y=F(X₁ X2) show that the marginal rate of substitution between the two inputs is equal to the ratio of their prices. b) Discuss under what circumstances the Hicksian and Walrasian demand functions are

a) Given two inputs X₁ and X₂ with Prices W₁ and W2, and a production function Y=F(X₁ X2) show that the marginal rate of substitution between the two inputs is equal to the ratio of their prices. b) Discuss under what circumstances the Hicksian and Walrasian demand functions are

ENGR.ECONOMIC ANALYSIS

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Chapter1: Making Economics Decisions

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