An individual consumes two goods. Let prices and income in periods 0 and 1 be given pº = (pi, p2), yº and p' = (pi, p2), y', respectively. Assume that both prices are 20% lower in period 1 compared to...

Calculate the individual’s equivalent variation.

Extracted text: An individual consumes two goods. Let prices and income in periods 0 and 1 be given pº = (pi, p2), yº and p' = (pi, p2), y', respectively. Assume that both prices are 20% lower in period 1 compared to period 0, but income did not change. Let the individual's indirect utility function be given by: v(p, y) = y//P1P2. Calculate the individual's equivalent variation.