Economics - Utility Function - Equilibrium - Economics Assignment Writing Help

Internal Code : AJ_SH_CGHA_DI

Economics Assignment Writing Help

TASK1 An agent has a utility function over goods 1 and 2 of the form , where c is your individual number and d is your minimum number. The agent’s income is equal to your 2-digit number. The price of good 1 is your maximum number and the price of good 2 is your median number.Derive the agent’s demand functions for good 1 and good 2. Calculate the quantities of good 1 and good 2 in the agent’s optimum bundle. An agent has a utility function over goods 1 and 2 of the form , where c is your 1-digit number and d is your minimum number. The agent’s income is equal to your 2-digitnumber. Initially, the price of good 1 is your median number and the price of good 2 is yourindividual number. Let the price of good 1 change to your maximum number. For good 1, determine for this price change the a) total price effect b) the substitution effect c) the income effect TASK2 Consider the problem you analysed in Question 2. Instead of the income value you used there, allow the agent to have an endowment of good 1 equal to the first digit of your 2- digit number, and an endowment of good 2 equal to the second digit of your 2-digitnumber. Derive expressions for the ordinary demands for both goods and calculate thegross and net demands for each good. An agent has a utility function over wealth given by where c is your 1-digitnumber. Their wealth if not robbed is equal to your 2-digit number multiplied by 1000.Should they be robbed, their wealth will be your maximum number multiplied by 1000.They assess the probability of being robbed as 1/(median number x 10). How muchwould this agent be prepared to pay for full insurance? How much would they have to pay for full (actuarially) fair insurance?