Dr. Weirdtaste buys only food (F) and clothing (C) out of his income. He has positive...
Dr. Weirdtaste buys only food (F) and clothing (C) out of his income. He has positive marginal utilities for both goods, and his MRSF,C is increasing. Draw two of Dr. Weirdtaste’s indifference curves, IC1 and IC2, where bundles on IC2 are preferred to bundles on IC1.
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Dr. Weirdtaste buys only food (F) and clothing (C) out of his
income. He has positive...
The utility that Julie receives by consuming food F and clothing C is given by U(F,...
The utility that Julie receives by consuming food F and clothing C is given by U(F, C) = FC. For this utility function, the marginal utilities are MUF = C and MUC = F. a) On a graph with F on the horizontal axis and C on the vertical axis, draw indifference curves for U = 12, U = 18, and U = 24. b) Do the shapes of these indifference curves suggest that Julie has a diminishing marginal rate...
3.10. The utility that Julie receives by consuming food F and clothing C is given by...
3.10. The utility that Julie receives by consuming food F and clothing C is given by U(F, C) = FC. For this utility function, the marginal utilities are MUF = C and MUC = F. a) On a graph with F on the horizontal axis and C on the vertical axis, draw indifference curves for U = 12, U = 18, and U= 24. b) Do the shapes of these indifference curves suggest that Julie has a diminishing marginal rate...
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...
Suppose there are two goods, food and clothing. My preference has the following properties: 1. I...
Suppose there are two goods, food and clothing. My preference has the following properties: 1. I am rational. 2. I need at least one unit of food and one unit of clothing in order to survive 3. I strictly prefer surviving over not surviving. 4. I am indifferent over all situations in which I do not survive. 5. When I have strictly more than one unit of each good, I satisfy strict monotonicity and strict convexity. 2 6. When I...
Suppose that Bridget and Erin spend their incomes on only two goods, food (F) and clothing...
Suppose that Bridget and Erin spend their incomes on only two goods, food (F) and clothing (C). Bridget’s preferences are represented by the utility function U(F,C)=10FC, while Erin’s preferences are represented by the utility function UF,C=5F2C. With the market basket F=2 and C=5, both Bridget and Erin get 100 unit of utility. Is it correct to say that Bridget and Erin have the same preference (i.e. their indifference curves are the same)? Explain your answer. Would you agree that Erin...
please show clear steps Suppose there are two goods, food and clothing. My preference has the...
please show clear steps
Suppose there are two goods, food and clothing. My preference has the following properties: 1. I am rational. 2. I need at least one unit of food and one unit of clothing in order to survive. 3. I strictly prefer surviving over not surviving. 4. I am indifferent over all situations in which I do not survive 5. When I have strictly more than one unit of each good, I satisfy strict monotonicity and strict convexity....
please show clear steps. Thanks! Suppose there are two goods, food and clothing. My preference has...
please show clear steps. Thanks!
Suppose there are two goods, food and clothing. My preference has the following properties: 1. I am rational. 2. I need at least one unit of food and one unit of clothing in order to survive. 3. I strictly prefer surviving over not surviving. 4. I am indifferent over all situations in which I do not survive 5. When I have strictly more than one unit of each good, I satisfy strict monotonicity and strict...
Suppose Cole buys food (X) and clothing (Y) with his income of $500 per month. The prices that Co...
Suppose Cole buys food (X) and clothing (Y) with his income of $500 per month. The prices that Cole faces in month one are $2 per unit of food and $4 per unit of clothing. His utility-maximizing choice is 100 food units and 75 clothing units. His preferences are convex. Now assume that in month two, Cole's income increases by 11% to $555, the price of food increases by 5% to $2.10, and the price of clothing increases by 15%...
Question 2 A consumer purchases two goods, food (x) and clothing (y). He has the utility function...
Question 2 A consumer purchases two goods, food (x) and clothing (y). He has the utility function U(X,Y) = XY, where X and Y denote amounts of X and Y consumed. Marginal utilities of X and Y are MUx = y and MUy = x. The consumer’s income is $72 per week and that the price of y is Py = $1 per unit and price of x is Px1 = $9 per unit. What are his initial quantities of X and...
Jennifer buys two goods, food (F) and clothing (C), with the utility function U(F,C) = FC....
Jennifer buys two goods, food (F) and clothing (C), with the
utility function U(F,C) = FC. Assume initially that she has an
income of $72, the price of clothing is PC = $1 per unit, and the
price of food is initially PF1 = $9 per unit and that the price
subsequently falls to PF2 = $4 per unit. Use this information and
the accompanying graph to answer the following questions.
(a) Find the equation for budget line (BL1) when...
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...
Suppose there are two goods, food and clothing. My preference has the following properties: 1. I am rational. 2. I need at least one unit of food and one unit of clothing in order to survive 3. I strictly prefer surviving over not surviving. 4. I am indifferent over all situations in which I do not survive. 5. When I have strictly more than one unit of each good, I satisfy strict monotonicity and strict convexity. 2 6. When I...
please show clear steps
Suppose there are two goods, food and clothing. My preference has the following properties: 1. I am rational. 2. I need at least one unit of food and one unit of clothing in order to survive. 3. I strictly prefer surviving over not surviving. 4. I am indifferent over all situations in which I do not survive 5. When I have strictly more than one unit of each good, I satisfy strict monotonicity and strict convexity....
please show clear steps. Thanks!
Suppose there are two goods, food and clothing. My preference has the following properties: 1. I am rational. 2. I need at least one unit of food and one unit of clothing in order to survive. 3. I strictly prefer surviving over not surviving. 4. I am indifferent over all situations in which I do not survive 5. When I have strictly more than one unit of each good, I satisfy strict monotonicity and strict...
Jennifer buys two goods, food (F) and clothing (C), with the
utility function U(F,C) = FC. Assume initially that she has an
income of $72, the price of clothing is PC = $1 per unit, and the
price of food is initially PF1 = $9 per unit and that the price
subsequently falls to PF2 = $4 per unit. Use this information and
the accompanying graph to answer the following questions.
(a) Find the equation for budget line (BL1) when...
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