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(Solved): 1. Show that if the utility function is homothetic, the individual's demand functions are linear in ...
1. Show that if the utility function is homothetic, the individual's demand functions are linear in income. 2. Define and discuss the properties of the indirect utitity funchon. (you may, but you do not have to prove the properties). 3. Define and discuss the properties of the expenditure function, (you may, but you do not have to prowe the properties).
Expert Answer
ANSWER 1 = A homothetic utility function is one which is a monotonic transformation of a homogeneous utility function. In generally if H is monotonic