Microeconomic Theory - Marshallian demand Functions & indirect utility function.

Consider the problem of maximizing u = (x1x2)2 subject to p1x1 + p2x2 = y. Derive the Marshallian demand functions and the indirect utility function; and confirm that Roy's identity holds.

inferior good, maximizing, labour supply upward sloping, envelope theorem

Consider the problem of maximizing u(c,l) subject to pc + wl = wT + Y, where c is consumption, l is leisure time, T is the total time endowment, and Y is non-wage income. Show that if leisure is an inferior good, then the labour supply function is upward-sloping. b) Given the problem of maximizing ln x subject to α ≥ x2, when α > 0, confirm that the envelope theorem holds.

Price elasticity for a product.

Price rises from $10 to $15, and the quantity demanded falls from 100 units to 60 units. What is the coefficient of the price elasticity of demand between the two prices? A) 1.25 B) 0.80 C) 0.60 D) 1.00

price elasticity of supply

As price falls from $4 to $3, quantity supplied falls from 400 units to 350 units. Price elasticity of supply is: A) 0.95 B) 1.20 C) 2.22 D) .50

maximize tax revenue

Government wants to maximize its tax revenue and it can place only $2 per-unit tax on one of two goods. It should place the tax on the production of the good whose demand curve has the: A) higher price elasticity of demand B) lower price elasticity of demand C) greater length D) shorter length