U = 4x11/2 + 2x2. p1 = 12 and p2 = 8. Income (m) is 173.16.
The utility optimizing quantity of x1 is
U = 4x11/2 + 2x2. p1 = 12 and p2 = 8. Income (m) is 173.16. The utility optimizing quantity of x2 is
U = 3x10.5 + 10x2 P1 = $3, P2 = $10, and m (income) = $100 Subject to the budget constraint, what is the utility maximizing quantities of x1 and x2?
U = 4x11/2 + 2x2. The Marginal Rate of Substitution at (1,2) is?
Suppose an individual’s utility function is u=x11/2, x21/2. Let p1=4, p2=5, and income equal $200. With a general equation and general prices, derive the equal marginal principle. Graphically illustrate equilibrium and disequilibrium conditions and how consumers can reallocate their consumption to maximize utility. What is the optimal amount of x1 consumed? What is the optimal amount of x2 consumed? What is the marginal rate of substitution at the optimal amounts of x1 and x2? As functions of p1, p2, and...
A consumer has income M, and faces prices (for goods 1 and 2) p1 and p2. For each of the following utility functions, graphically show the following: (i) the Slutsky substitution and income e⁄ects when p1 decreases. (ii) the Hicks substitution and income e⁄ects when p1 decreases. (iii) the Marshallian and Hicksian demand curves for good 1: (a) perfect complements: U(x1 , x2) = min {4x1, 5x2} (b) quasi-linear: U(x1 , x2) = x^2/3 1 + x2
Q6 Deriving Demand Function Derive demand functions x1(P1, P2, m) and x2(P1, P2, m) for the consumer with the utility function U(x1, x2) = xi x2
U = 8x10.5+ 2x2, where x1 is the quantity of good 1 consumed, and x2 is the quantity of good 2 consumed. (Yes the x is raised) 8x1.5 Suppose that the consumer has a budget of M = $400 to spend and that good 1 has a price of p1= 2, and good 2 has a price of p2= 8. Answer the following questions, and write your answers in the Answer Sheet. Write the person’s budget constraint as an equation,...
My utility is given by u(x1, x2) = 2x194x2-2 + In(x1) + [min{x1, x2)] + 2x2 + x1!! True, False, or Cannot Be Determined: When P1 = $2,P2 = $4, and I = $100, my optimal consumption bundle is (x1,x2) = (25,15).
Jerami's utility function is given by U(x1,x2) = 2x1 +2X2. What is his demand for each good if P1 = 4,P2 =6, and m=60? x1 = 6; x2 = 6 x1 =0:x2 - 10 x1 = 15; x2 = 0 O x1 = 60; x2 = 0
1.) Liz has utility given by u(x2,x1)=x1^7x2^8. If P1=$10, P2=$20, and I = $150, find Liz’s optimal consumption of good 1. (Hint: you can use the 5 step method or one of the demand functions derived in class to find the answer). 2.) Using the information from question 1, find Liz’s optimal consumption of good 2 3.) Lyndsay has utility given by u(x2,x1)=min{x1/3,x2/7}. If P1=$1, P2=$1, and I=$10, find Lyndsay’s optimal consumption of good 1. (Hint: this is Leontief utility)....