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1. Ann's preferences are represented by : U(x,y)=x+ln(y).
(1) Find Ann's demand function y*, assuming she consumes both x and y.
(2) Find Ann's demand function for x.
(3) Now suppose p(x)>m and p(y)>m. Find x*, y*
2. Ann's preference estruture for x and y can be represented by U(x,y)=x^(2/5)y^(3/5). Her budget constraint is 2x+3y=20.
(1) Are x and y substitutes or complement?
(2) What proportion of income does Ann spend on x? On y?
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