Harvey's net demands for goods 1 and 2 are (2, -3) and his endowment is (6, 5).
a. What are his gross demands?
b. Draw a diagram illustrating his budget line, his endowment, and his consumption. (Put good 1 on the horizontal axis.)
c. Draw a dotted line to show what his budget line would be if the price of good 1 doubled and the price of good 2 stayed the same.

Question

Quizplus · Accepted Answer

The Answer of Harvey's net demands for goods 1 and 2 are (2, -3) and his endowment is (6, 5).
a. What are his gross demands?
b. Draw a diagram illustrating his budget line, his endowment, and his consumption. (Put good 1 on the horizontal axis.)
c. Draw a dotted line to show what his budget line would be if the price of good 1 doubled and the price of good 2 stayed the same.

Harvey's Net Demands for Goods 1 and 2 Are (2