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Q1.Budget equation is 8x+py*y=656
We have to maximise U=A* x^.5 *y^0.5
put x in above equation and optimise
We get y= 328/py...required demand
Q2.R=100Q-2Q^2
MR=100-4Q
Given MR=20 So Q=20
R=PQ
So P= 100-2Q (Demand function)
Point elasticity = dQ/dP/Q/P
Put Q=20 in above eqn and find elasticity= 1.5
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