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QUESTION

Emily's income is $120. She spends her entire income on books.

MUx/Px> MUy/Py

Assume now that the income of this consumer increases by $90. Calculate the change in demand for good x associated with this change in income.

4. Assume an economy with two goods, x and y. A consumer's demand for good x is given by /Px+Py.

Good x and good y are both normal goods. True or False?

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