Which of the following is/are correct about Walrasian demand function?
A. The Walrasian demand function X(P, W) is homogenous of degree zero if \(X(α P, α W)=X(P, W)\) for any P, W and α > 0.
B. The Walrasian demand function X(P, W) is homogenous of degree one if X(αP, αW) = αX(P, W) for any P, W and α > 0.
C. The Walrasian demand function X(P, W) satisfies Walras' law if for every P > > 0 and W > 0, we have P.X = W for all X ∈ X(P, W)
D. Walras' law says consumer fully expends his wealth.
E. If price and wealth both change in same proportion, then individual consumption choice does not change.
Choose the correct answer from the option given below:
1
A, B, C, D only
2
B, C, D, E only
3
A, B, C, E only
4
A, C, D, E only