What are the expenditure shares


Discussion:

Consider a consumer with utility u(x, y) = √xy . The consumer has $100 to spend, and the price of X is $5 and the price of Y is $2.

(1) Graph the budget line.

(2) Find the point that maximizes the consumers utility given the budget. Draw the indifference curve through this point.

(3) What are the expenditure shares?

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Microeconomics: What are the expenditure shares
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