Note: The program was written by Johan Phoea in Fall 1998 as an independent study project. In order to use this page you need a JAVA-enabled browser.

Explanation: The program computes the optimal consumption choice for a Cobb-Douglas utility function of the form u(x₁,x₂)= x₁^c x₁^d. After you insert all values hit return and the program will compute and graphically represent the optimal consumption choice before and after a price change. The budget set before the price change is yellow in the graph. The budget line after the price change is red. Delta p1 and Delta p2 are the price changes. U and U' are the indifference curves through the optimal consumption choice before and after the price change.