Rosalia buys only two goods X₁ and x₂. Her utility function is Cobb-Douglas. Her optimal choices have which of the following properties? One of the goods is an inferior good and the other is a normal good. Her purchase of x₁ depends on her income and on the prices of both goods, p₁ and p2. Her purchase of x₁ does not depend on income. O Her purchases for neither good depends on income. O Her purchase of x2 depends only on her income and on the price of that good, p2.
Rosalia buys only two goods X₁ and x₂. Her utility function is Cobb-Douglas. Her optimal choices have which of the following properties? One of the goods is an inferior good and the other is a normal good. Her purchase of x₁ depends on her income and on the prices of both goods, p₁ and p2. Her purchase of x₁ does not depend on income. O Her purchases for neither good depends on income. O Her purchase of x2 depends only on her income and on the price of that good, p2.
Chapter6: Consumer Choice And Demand
Section: Chapter Questions
Problem 2.5P
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Transcribed Image Text:Rosalia buys only two goods X₁ and x₂. Her
utility function is Cobb-Douglas. Her optimal
choices have which of the following properties?
O One of the goods is an inferior good and the
other is a normal good.
O Her purchase of x₁ depends on her income and
on the prices of both goods, p₁ and p2.
O Her purchase of x₁ does not depend on income.
O Her purchases for neither good depends on
income.
O Her purchase of x2 depends only on her income
and on the price of that good, p2.
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