## What are the properties of marshallian demand function?

Thus, assuming the consumer’s utility is continuous and locally non-satiated, we have established four properties of the Marshallian demand function: it “exists”, is insensitive to proportional increases in price and income, exhausts the consumer’s budget, and is single-valued if preferences are strictly convex.

**What is the difference between Hicksian and marshallian demand?**

Hicksian demand curves show the relationship between the price of a good and the quantity demanded of it assuming that the prices of other goods and our level of utility remain constant. Marshallian demand assumes only nominal wealth remains equal.

### What is the compensated demand?

Definition: the compensated demand curve is a demand curve that ignores the income effect of a price change, only taking into account the substitution effect. To do this, utility is held constant from the change in the price of the good.

**What is the difference between Hicksian and Marshallian demand?**

## Is there a Marshallian demand function?

In some cases, there is a unique utility-maximizing bundle for each price and income situation; then, is a function and it is called the Marshallian demand function. If the consumer has strictly convex preferences and the prices of all goods are strictly positive, then there is a unique utility-maximizing bundle.

**Is Marshallian demand homogeneous or heterogeneous?**

Marshallian demand is homogeneous of degree zero in money and prices. In general, a function is called homogeneous of de- gree k in a variable X if F () = X: Note that the particular case where F () = X is just the case where k = 0 so this is homogeneity of degree zero.

### Why is Marshallian demand correspondence called a correspondence?

As utility maximum always exists, Marshallian demand correspondence must be nonempty at every value that corresponds with the standard budget set. is called a correspondence because in general it may be set-valued – there may be several different bundles that attain the same maximum utility.

**What is Marshall’s demand curve theory?**

Marshall’s theory exploits that demand curve represents individual’s diminishing marginal values of the good. The theory insists that the consumer’s purchasing decision is dependent on the gainable utility of a goods or services compared to the price since the additional utility that the consumer gain must be at least as great as the price.