Question

Sam's is interested in two goods, X and Y. His indirect utility function is U* =...

Sam's is interested in two goods, X and Y. His indirect utility function is

U* = M px-.6 py-4.    ( same as U* = M /(px.6 py0.4 ) )

where

M is Sam's income, and px   and py denote respectively the price of good X and the price of good Y.  

Sam's market demand functions are X*=0.6M/px and Y* = 0.4M/py .

Find the absolute value of the change in Sam's consumers surplus if the price of good X rises from 1 to 4.3 dollars assuming his income is M=152.3 and price of good Y is equal to 1.

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