Determine demands for goods when consumer faces prices


Consider a consumer with utility function given by u(x1 , x2 ) = x1 x2 .

(i ) Find the demands for goods 1 and 2 when the consumer faces prices p1 and p2 , and income m.

(ii ) Are goods 1 and 2 normal goods? Why?

(iii ) Are goods 1 and 2 ordinary goods? Why?

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Microeconomics: Determine demands for goods when consumer faces prices
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