Question

Lucas gets utility (satisfaction) from two goods, A and B, according to the utility function U(A,B) = 10[A−2 +B−2]−2. While Luke would like to consume as much as possible he is limited by his income.
a. Maximize Lucas’ utility subject to the budget constraint using the Lagrangean method.

3. Utility maximization under constraint Lucas gets utility (satisfaction) from two goods, A and B, according to the utility function U(A,B) = 10[A-? +B)-2. While Luke would like to consume as much as possible he is limited by his income. 4. Maximize Lucas' utility subject to the budget constraint using the Lagrangean method.

Answer 1

Aracsen:- UCHB) = 10 [A2+ 8? J? @ using the Lagrange an method: L= UCA,B) + X (in - Pa A - PAB) SO LE 10[2 + 811]? +(M-PA-Pe B) ho =2(10) (A2+8% 5° (6213) – APA = 0 0 -2015) e*]* (262) - slo-o - from equation 0 and 2) we get, from ② , we get, PA (B3 PA/PE) 3+ Pg B = m SPA (PH/P.) 3 +P8] B=m ev = wagen (oryeoy's + Pe] no plorerosa.com optimum solution for Lukos.