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4) Consider the utility function U = 2F + 5C. a. Carefully sketch the indifference curve...
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 =...
3. Paul derives utility only from CDs and DVDs. His utility function is Sketch Paul's indifference...
3. Paul derives utility only from CDs and DVDs. His utility function is Sketch Paul's indifference curves for U-5, U-10, and U-20 Suppose Paul has $200 to spend and that CDs cost $5 and DVDs cost $20. Draw Paul's budget constraint on the same graph as his ndifference curves Suppose Paul spends all of his income on DVDs. How many can he buy and what is his utility? Show that Paul's income will not permit him to reach the U-20...
4. Suppose that Noah's utility function is given by (a) Draw an indifference curve that goes...
4. Suppose that Noah's utility function is given by (a) Draw an indifference curve that goes through the bundle (2,2), where xi is on the horizontal axis and z2 is on the vertical axis. (b) Draw another indifference curve that goes through the bundle (3, 3) on the same diaram as (a). Label carefully. (c) What kind of preference does Noah have about the two goods?
4. Assume a utility function described by u(x,y)=2/xy. a. Given the utility function, u(x,y)=2xy, sketch the...
4. Assume a utility function described by u(x,y)=2/xy. a. Given the utility function, u(x,y)=2xy, sketch the indifference curves for u = 50, 72 and 98. e indifference Carved forbise banta un b. Sketch budget constraint of 5x +10y = 30. Label intercepts (where it crosses the axes). 00:0 VE c. Solve for calculate) the optimal bundle (x, y) and sketch the optimal solution.
Consumption-Savings Consider a consumer with a lifetime utility function U = u(Ct) + _u(Ct+1) that satisfies...
Consumption-Savings Consider a consumer with a lifetime utility function U = u(Ct) + _u(Ct+1) that satisfies all the standard assumptions listed in the book. The period t and t + 1 budget constraints are Ct + St = Yt Ct+1 + St+1 = Yt+1 + (1 + r)St (a) What is the optimal value of St+1? Impose this optimal value and derive the lifetime budget constraint. (b) Derive the Euler equation. Explain the economic intuition of the equa- tion. (c)...
4. Andy's utility is represented by the function U(X,Y) - XY. His marginal utility of X...
4. Andy's utility is represented by the function U(X,Y) - XY. His marginal utility of X is MUx = Y. His marginal utility of Y is MUY = . He has income $12. When the prices are Px - 1 and Py -1, Andy's optimal consumption bundle is X* -6 and Y' = 6. When the prices are Px = 1 and P, = 4, Andy's optimal consumption bundle is X** = 6 and Y* 1.5. Suppose the price of...
A consumer has the utility function U(X, Y) = (X + 2)(Y + 4). Her income is...
A consumer has the utility function U(X, Y) = (X + 2)(Y + 4). Her income is $100, the price of X is $4, and the price of Y is $5. In order to maximize utility subject to her budget constraint, how many units of X and Y will our consumer choose to purchase? Sketch a budget line – indifference curve diagram illustrating this optimum. Label this optimum A. Suppose the price of X increases to $8, while income and the price...
2. Consider the following four consumers (C1,C2,C3,C4) with the following utility functions: Consumer Utility Function C1...
2. Consider the following four consumers (C1,C2,C3,C4) with the following utility functions: Consumer Utility Function C1 u(x,y) = 2x+2y C2 u(x,y) = x^3/4y^1/4 C3 u(x,y) = min(x,y) C4 u(x,y) = min(4x,3y) On the appropriate graph, draw each consumer’s indifference curves through the following points: (2,2), (4,4), (6,6) and (8,8), AND label the utility level of each curve. Hint: Each grid should have 4 curves on it representing the same preferences but with different utility levels. 3. In the following parts,...
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 =...
3. Paul derives utility only from CDs and DVDs. His utility function is Sketch Paul's indifference curves for U-5, U-10, and U-20 Suppose Paul has $200 to spend and that CDs cost $5 and DVDs cost $20. Draw Paul's budget constraint on the same graph as his ndifference curves Suppose Paul spends all of his income on DVDs. How many can he buy and what is his utility? Show that Paul's income will not permit him to reach the U-20...
4. Suppose that Noah's utility function is given by (a) Draw an indifference curve that goes through the bundle (2,2), where xi is on the horizontal axis and z2 is on the vertical axis. (b) Draw another indifference curve that goes through the bundle (3, 3) on the same diaram as (a). Label carefully. (c) What kind of preference does Noah have about the two goods?
4. Assume a utility function described by u(x,y)=2/xy. a. Given the utility function, u(x,y)=2xy, sketch the indifference curves for u = 50, 72 and 98. e indifference Carved forbise banta un b. Sketch budget constraint of 5x +10y = 30. Label intercepts (where it crosses the axes). 00:0 VE c. Solve for calculate) the optimal bundle (x, y) and sketch the optimal solution.
4. Andy's utility is represented by the function U(X,Y) - XY. His marginal utility of X is MUx = Y. His marginal utility of Y is MUY = . He has income $12. When the prices are Px - 1 and Py -1, Andy's optimal consumption bundle is X* -6 and Y' = 6. When the prices are Px = 1 and P, = 4, Andy's optimal consumption bundle is X** = 6 and Y* 1.5. Suppose the price of...
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