Economy, asked by khushigurunani2002, 6 months ago

3. You receive utility from days spent traveling on vacation domestically (D) and days spent traveling in a foreign country (F) as given by the utility function U(D, F) = DF. The price of a day spent traveling domestically is Rs 160 and in a foreign country Rs 200. Your annual budget for traveling is Rs 8,000.

a) Compute your utility maximizing choice of domestic travel (D) and foreign travel (F). [2.5]

b) Compute the price elasticity of your demand for domestic travel. [2.5]

Answers

Answered by ayaan304
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Answer:

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