Re: Microeconomics.

Posted by Abhitesh on Oct 10, 2016; 11:24am
URL: http://discussion-forum.276.s1.nabble.com/Microeconomics-tp7602898p7602902.html

Monotonic transformation will greatly simplify. But it can be solved directly.
Let the budget line be p*x1+x2=m. And [(x1+lnx2)^1/3] = z or [{(m-x2)/p + lnx2}^1/3]=z.
Then dU/dx2 = 0 => dU/dz * dz/dx2 = 0.
dU/dz being exponential function cannot be zero.
So dz/dx2 = 0.