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4. Bert's preferences for Coke and Mountain Dew are described by the utility function U(C, M)...
4. Mountain Dew, which (fun fact) was invented in east Tennessee, is sold in 6 and...
4. Mountain Dew, which (fun fact) was invented in east Tennessee, is sold in 6 and 12-packs (a 6 pack contains 6 cans of Mountain Dew in a single package, and a 12 pack contains 12 cans of Mountain Dew in a single package). In this exercise we are going to explore how the MRS for Mountain Dew and pretzels might be affected by the units of measurement for Mountain Dew. a. Suppose Mountain Dew is only sold in 6-packs....
John has preferences for food F and clothing C described by a utility function U(F,C) =...
John has preferences for food F and clothing C described by a utility function U(F,C) = min (F, 2C). Suppose that food costs $1 a unit and that clothing costs $2 a unit. John has $12 to spend on food and clothing. (10 pts.) a) On a graph, draw indifference curves corresponding to u = 6, u = 10, u = 14. Make sure to label coordinates clearly. Using the graph, find the optimal choice of food and clothing. Let...
Treat Bob and Joe as having the same utility function as provided at the beginning of...
Treat Bob and Joe as having the same utility function as
provided at the beginning of the question
Indifference curves and utility: Consider the utility function U (qi,%)-2q1/2 + q2 that describes Joe's preferences. For the following, think of q1 as the variable you would graph on the horizontal axis. 3. a. Derive an expression for his marginal utility (U) from a small increase in qi holding q2 fixed. Also, find b. What is Joe's marginal rate of substitution (MRS)?...
Treat Bob and Joe as the same individual and having the same utility function as provided...
Treat Bob and Joe as the same individual and having the same
utility function as provided at the beginning of the question.
Looking for the solutions to part e and f.
Indifference curves and utility: Consider the utility function U (qi,%)-2q1/2 + q2 that describes Joe's preferences. For the following, think of q1 as the variable you would graph on the horizontal axis. 3. a. Derive an expression for his marginal utility (U) from a small increase in qi holding...
QUESTION 4 Reshad's preferences over goods 1 and 2 are given by the following utility function:...
QUESTION 4 Reshad's preferences over goods 1 and 2 are given by the following utility function: U(q1, q2)q2Select all that applies: O a His preferences satisfy "more is better O b. His preferences fail the transitivity assumption C. His indifference curves are downward sloping His preferences are convex D e. He dislikes good 1 Marginal rate of substitution for his preferences is given by MRS12
3. Suppose the utility function for two goods, x and y, is: U = U(x,y) =...
3. Suppose the utility function for two goods, x and y, is: U = U(x,y) = xłyż. a. Graph the indifference curve for U = 10. b. If x = 5, what must y equal to be on the U = 10 indifference curve? What is the MRS at this point? c. Derive a general expression for the MRS for this utility function. Show how it can be interpreted as the ratio of the marginal utilities. d. Does this individual...
1. Sally has preferences represented by the utility function UC, M) = 3 + 61rC M, where C is coffee and M is meals....
1. Sally has preferences represented by the utility function UC, M) = 3 + 61rC M, where C is coffee and M is meals. Her income is S100, and she pays $2 per coffee and S10 per meal a. Distinguish (the concepts of) diminishing marginal rate of substitution from diminishing marginal uty Your answer does not have to be specific to Sally's preferences. (4 points) Use the Lagrangian method to derive Sally's utility maximizing bundle given her budget constraint. Circle...
Indifference curves and utility: Consider the utility function ? (?1, ?2) = 6?1^1/2 + ?2 that...
Indifference curves and utility: Consider the utility function ? (?1, ?2) = 6?1^1/2 + ?2 that describes Moe’spreferences. For the following, think of q1 as the variable you would graph on the horizontal axis. a. Derive an expression for his marginal utility (U1) from a small increase in q1 holding q2 fixed. Also, find U2. b. What is Moe’s marginal rate of substitution (MRS)? Give a brief (2 sentences maximum) intuitive description of what MRS represents. c. Given your answer...
3) Consider the utility function U = 3FC. a. Carefully sketch the indifference curve for utility...
3) Consider the utility function U = 3FC. a. Carefully sketch the indifference curve for utility of 24. Label four market baskets on the indifference curve. (Hint: In Desmos, enter 24=3xy) b. Carefully sketch the indifference curve for utility of 48. Label four market baskets on the indifference curve. c. Which market basket gives highest utility: (0,10) or (2,8) or (5,5) or (9,2)? Rank the market baskets and identify them on your graph. 4) Consider the utility function U =...
4. Anne's utility function is given by u(xi,x2) Michael's utility function is given by u(xı, x2)' = x1x2. S...
4. Anne's utility function is given by u(xi,x2) Michael's utility function is given by u(xı, x2)' = x1x2. She has two friends, Michael and Peter 1 and Peter's is given by u(x1, X2) = = 1042 1 Τ) -x12. Who has the same preferences as Anne? And who has indifference curves with similar shape as Anne's indifference curves? Explain.
4. Anne's utility function is given by u(xi,x2) Michael's utility function is given by u(xı, x2)' = x1x2. She has two...
John has preferences for food F and clothing C described by a utility function U(F,C) = min (F, 2C). Suppose that food costs $1 a unit and that clothing costs $2 a unit. John has $12 to spend on food and clothing. (10 pts.) a) On a graph, draw indifference curves corresponding to u = 6, u = 10, u = 14. Make sure to label coordinates clearly. Using the graph, find the optimal choice of food and clothing. Let...
Treat Bob and Joe as having the same utility function as
provided at the beginning of the question
Indifference curves and utility: Consider the utility function U (qi,%)-2q1/2 + q2 that describes Joe's preferences. For the following, think of q1 as the variable you would graph on the horizontal axis. 3. a. Derive an expression for his marginal utility (U) from a small increase in qi holding q2 fixed. Also, find b. What is Joe's marginal rate of substitution (MRS)?...
Treat Bob and Joe as the same individual and having the same
utility function as provided at the beginning of the question.
Looking for the solutions to part e and f.
Indifference curves and utility: Consider the utility function U (qi,%)-2q1/2 + q2 that describes Joe's preferences. For the following, think of q1 as the variable you would graph on the horizontal axis. 3. a. Derive an expression for his marginal utility (U) from a small increase in qi holding...
QUESTION 4 Reshad's preferences over goods 1 and 2 are given by the following utility function: U(q1, q2)q2Select all that applies: O a His preferences satisfy "more is better O b. His preferences fail the transitivity assumption C. His indifference curves are downward sloping His preferences are convex D e. He dislikes good 1 Marginal rate of substitution for his preferences is given by MRS12
3. Suppose the utility function for two goods, x and y, is: U = U(x,y) = xłyż. a. Graph the indifference curve for U = 10. b. If x = 5, what must y equal to be on the U = 10 indifference curve? What is the MRS at this point? c. Derive a general expression for the MRS for this utility function. Show how it can be interpreted as the ratio of the marginal utilities. d. Does this individual...
1. Sally has preferences represented by the utility function UC, M) = 3 + 61rC M, where C is coffee and M is meals. Her income is S100, and she pays $2 per coffee and S10 per meal a. Distinguish (the concepts of) diminishing marginal rate of substitution from diminishing marginal uty Your answer does not have to be specific to Sally's preferences. (4 points) Use the Lagrangian method to derive Sally's utility maximizing bundle given her budget constraint. Circle...
3) Consider the utility function U = 3FC. a. Carefully sketch the indifference curve for utility of 24. Label four market baskets on the indifference curve. (Hint: In Desmos, enter 24=3xy) b. Carefully sketch the indifference curve for utility of 48. Label four market baskets on the indifference curve. c. Which market basket gives highest utility: (0,10) or (2,8) or (5,5) or (9,2)? Rank the market baskets and identify them on your graph. 4) Consider the utility function U =...
4. Anne's utility function is given by u(xi,x2) Michael's utility function is given by u(xı, x2)' = x1x2. She has two friends, Michael and Peter 1 and Peter's is given by u(x1, X2) = = 1042 1 Τ) -x12. Who has the same preferences as Anne? And who has indifference curves with similar shape as Anne's indifference curves? Explain.
4. Anne's utility function is given by u(xi,x2) Michael's utility function is given by u(xı, x2)' = x1x2. She has two...
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