Consumer A has a Cobb -Douglas utility function with exponents that sum to 1. Consumer B...
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Consumer A has a Cobb -Douglas utility function with exponents that
sum to 1. Consumer B...
1. answer it only numerical values. 2. A person has a Cobb Douglas utility function for...
1.
answer it only numerical values.
2.
A person has a Cobb Douglas utility function for two goods X and
Y. If the price of a X increases and the budget stays the same, the
utility maximizing person __________.
Cannot be determined from the information
will consume less of Y
will only consume Y
will consume less of both goods
will have lower utility
Sara has $40 in her budget. Given the following graph, what is the MRS of her...
A person has a Cobb Douglas utility function for two goods X and Y. If the...
A person has a Cobb Douglas utility function for two goods X and Y. If the price of a X increases and the budget stays the same, the utility maximizing person __________. Cannot be determined from the information will consume less of Y will only consume Y will consume less of both goods will have lower utility
A person has a Cobb Douglas utility function for two goods X and Y. If the...
A person has a Cobb Douglas utility function for two goods X and Y. If the price of a X decreases and the budget stays the same, then a utility maximizing person O will only consume X* O will consume more of Y Cannot be determined from the information will consume more of both goods will have higher utility
26. If the sum of the exponents of a Cobb-Douglas production function is equal to 1.2,...
26. If the sum of the exponents of a Cobb-Douglas production function is equal to 1.2, the production function exhibits: a) increasing average costs b) constant returns to scale. c) increasing returns to scale. d) declining productivity. e) none of the above 27. Dana, who is a trained yoga instructor, spends 4 hours on Monday baking and packing 10 boxes of cookies. She sells the cookies for $10 a box. Given that she can also teach yoga for $80 an...
4. Suppose you have the following Cobb-Douglas Utility Function: And $200 to spend. a. Use the...
4. Suppose you have the following Cobb-Douglas Utility Function: And $200 to spend. a. Use the method of Lagrangian Multipliers, to maximize this consumer's utility and derive demand equations for both goods. Sketch their respective demand curves. Show all work. (5 pts) b. If Px = Py = $1, how much utility will the consumer enjoy? Show work/explain. (2.5 pts) c. Does this allocation satisfy the rule of equal marginal utility per dollar spent? Explain/show work. (2.5 pts)
1. When a consumer has a Cobb-Douglas utility function given by u(x, y) = xa yb , their demand for good x is given by x∗...
1. When a consumer has a Cobb-Douglas utility function given by u(x, y) = xa yb , their demand for good x is given by x∗ = m/Px (a/a+b) where m is income and Px is the price of good x. Using this demand function, find the formula for this consumer’s price elasticity of demand. Interpret it in words.
here's the utility function Let us introduce a second person, who has standard Cobb-Douglas utility UB...
here's the utility function
Let us introduce a second person, who has standard Cobb-Douglas utility UB = (x+B)•(x²B). Their endowments are wa= (6, 3) and WB = (3,6). You may assume p2 = 3p1. Find the amount person A consumes of good 1 in competitive equilibrium. Simplify decimals (no extra zeros). et ua = x+A+ 3x A.
A consumer who lives for two periods has a standard Cobb-Douglas utility func- tion: u(c1,c2) =...
A consumer who lives for two periods has a standard Cobb-Douglas utility func- tion: u(c1,c2) = ccm, where Ct = consumption in period t and a + b = 1. Her income in period one is I1 = 500 and 12 = 400, and she can lend or borrow at interest rate r = 0.2. (a) Find the optimal consumption demand. (b) What values of a, if any, makes the consumer a borrower? Interpret this result. (c) Suppose now that...
5. Suppose that each consumer has the Cobb-Douglas utility function u:(X1i, X2i) X11 X21-4. In addition...
5. Suppose that each consumer has the Cobb-Douglas utility function u:(X1i, X2i) X11 X21-4. In addition the endowments are wi=(1,2) and w2=(2,1). What should be the vector of prices (pı", p2') in order to achieve equilibrium (supply-demand). [Note use an increasing transformation of the utility functions given by a In Xii+(1-a) In X2i] . . following utility functions:
4) A consumer's utility function is Cobb-Douglas ulx, y2y2 Yesterday prices were P:-1, p,-1; today prices...
4) A consumer's utility function is Cobb-Douglas ulx, y2y2 Yesterday prices were P:-1, p,-1; today prices are p,-1, p,-2. Încome in both dates is I 120. (a) What was the consumer's optimal choice yesterday? (b) What is the consumer's optimal choice today? fa subsidy would I have to provide so that the consumer obtain the same utility today as yesterday? today? (This is compensated demand.) obtain the same bundle of goods today as yesterday? Is this more or less d)...
1.
answer it only numerical values.
2.
A person has a Cobb Douglas utility function for two goods X and
Y. If the price of a X increases and the budget stays the same, the
utility maximizing person __________.
Cannot be determined from the information
will consume less of Y
will only consume Y
will consume less of both goods
will have lower utility
Sara has $40 in her budget. Given the following graph, what is the MRS of her...
A person has a Cobb Douglas utility function for two goods X and Y. If the price of a X decreases and the budget stays the same, then a utility maximizing person O will only consume X* O will consume more of Y Cannot be determined from the information will consume more of both goods will have higher utility
26. If the sum of the exponents of a Cobb-Douglas production function is equal to 1.2, the production function exhibits: a) increasing average costs b) constant returns to scale. c) increasing returns to scale. d) declining productivity. e) none of the above 27. Dana, who is a trained yoga instructor, spends 4 hours on Monday baking and packing 10 boxes of cookies. She sells the cookies for $10 a box. Given that she can also teach yoga for $80 an...
4. Suppose you have the following Cobb-Douglas Utility Function: And $200 to spend. a. Use the method of Lagrangian Multipliers, to maximize this consumer's utility and derive demand equations for both goods. Sketch their respective demand curves. Show all work. (5 pts) b. If Px = Py = $1, how much utility will the consumer enjoy? Show work/explain. (2.5 pts) c. Does this allocation satisfy the rule of equal marginal utility per dollar spent? Explain/show work. (2.5 pts)
here's the utility function
Let us introduce a second person, who has standard Cobb-Douglas utility UB = (x+B)•(x²B). Their endowments are wa= (6, 3) and WB = (3,6). You may assume p2 = 3p1. Find the amount person A consumes of good 1 in competitive equilibrium. Simplify decimals (no extra zeros). et ua = x+A+ 3x A.
A consumer who lives for two periods has a standard Cobb-Douglas utility func- tion: u(c1,c2) = ccm, where Ct = consumption in period t and a + b = 1. Her income in period one is I1 = 500 and 12 = 400, and she can lend or borrow at interest rate r = 0.2. (a) Find the optimal consumption demand. (b) What values of a, if any, makes the consumer a borrower? Interpret this result. (c) Suppose now that...
5. Suppose that each consumer has the Cobb-Douglas utility function u:(X1i, X2i) X11 X21-4. In addition the endowments are wi=(1,2) and w2=(2,1). What should be the vector of prices (pı", p2') in order to achieve equilibrium (supply-demand). [Note use an increasing transformation of the utility functions given by a In Xii+(1-a) In X2i] . . following utility functions:
4) A consumer's utility function is Cobb-Douglas ulx, y2y2 Yesterday prices were P:-1, p,-1; today prices are p,-1, p,-2. Încome in both dates is I 120. (a) What was the consumer's optimal choice yesterday? (b) What is the consumer's optimal choice today? fa subsidy would I have to provide so that the consumer obtain the same utility today as yesterday? today? (This is compensated demand.) obtain the same bundle of goods today as yesterday? Is this more or less d)...
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