Harry and Sally have the following preferences:
uh(x; y) = ln(x) + ln(y)
us(x; y) = ln(x) + y
a. What is Harry's price elasticity of demand for good x, denoted "x;px ?
From Harry's perspective, is x ordinary, Gien, or neither?
b. What is Harry's income elasticity of demand for good x, denoted "x;I?
From Harry's perspective, is x normal, inferior, or neither?
c. What is Harry's cross-price elasticity of demand for good x, denoted "x;py ?
From Harry's perspective, are x and y complements, substitutes, or neither?
d. What is Sally's price elasticity of demand for good x, denoted "x;px?
From Sally's perspective, is x ordinary, Gien, or neither?
e. What is Sally's income elasticity of demand for good x, denoted "x;I?
From Sally's perspective, is x normal, inferior, or neither?
f. What is Sally's cross-price elasticity of demand for good x, denoted "x;py?
From Sally's perspective, are x and y complements, substitutes, or neither?