a) Graphically derive Vivi’s demand for tea when her income is $60 and the price of crumpets is $2. Do this by showing her optimal consumption (exact numbers) at three different values for the price of tea. (b) What is the formula for Vivi’s demand function for crumpets when her income is $60, the price of crumpets is pC, and the price of tea is pT ? Note:-

a) Graphically derive Vivi’s demand for tea when her income is $60 and the price of crumpets is $2. Do this by showing her optimal consumption (exact numbers) at three different values for the price of tea. (b) What is the formula for Vivi’s demand function for crumpets when her income is $60, the price of crumpets is pC, and the price of tea is pT ? Note:-

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter3: Preferences And Utility

Section: Chapter Questions

Problem 3.11P

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