QUESTION 16 The optimal amount of x1, x2, P1, P2 and income are given by the following: 41 X16P1 X₂ The original prices

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Question 16 The Optimal Amount Of X1 X2 P1 P2 And Income Are Given By The Following 41 X16p1 X The Original Prices 1 (46.87 KiB) Viewed 55 times

QUESTION 16 The optimal amount of x1, x2, P1, P2 and income are given by the following: 41 X16P1 X₂ The original prices are: P1-41 P2=39 The original income is: 1=1917 The new price of P1 is the following: P1'=69 Assume that the price of x1 has changed from P₁ to P1'. What is the income effect? QUESTION 17 21 6P₂ Belfast Company produces bicycles using labor (L) and capital (K). Its production function is given by th Q=4L+49 K where Q is the output of bicycles. The prices of labor (PL), capital (PK), bicycle (P) and the cost (C) are the following: PL=35, PK-23 P=38 C=2899 What is the profit maximizing level of bicycles that Belfast Company should produce?