uppose a consumer’s preferences for goods Y and X can be represented by the utility function, U(X,Y)=X2Y. The consumer's budget constraint is M=PxX+PyY where Px is the price of the good X, Py is the price of Y, and M represents income
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Suppose a consumer’s preferences for goods Y and X can be represented by the utility function, U(X,Y)=X2Y. The consumer's budget constraint is M=PxX+PyY where Px is the price of the good X, Py is the price of Y, and M represents income
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- Suppose a consumer’s preferences can be represented by the utility function U(X,Y) = Min (2X,Y). Also, suppose the consumer has $300 to spend and the price of Good X is PX = $2 and the price of Good Y is PY = $5. If the consumer maximizes their utility subject to their budget constraint, how much of Good X and how much of Good Y will the consumer purchase? X* = Y* =.Consider a consumer with the utility function u(x1,x2) = x11/3 x22/3. a. Find the Marginal Utility for each good. b. Find the slope of one of this consumer's indifference curves c. Write down the consumer's budget constraint. d. What is the slope of this consumer's budget constraint? Show how you derived your answerConsider the following utility function for goods x1 and x2: u(x1,x2)=(x1+x2)2 What type of preferences does this utility function represent and why?
- A consumer has set a budget of $400 for the consumption of good X and Y. The price of Good X is S"Px", and the price of good Y is S5. The consumer has a Utility function given by U(X,Y) = ху Find the optimal consumption choice of the individual and the utility obtained in terms of Px. Make a graph that illustrates the solution to the problem. Why do we use parameters?Suppose there are two goods, x and y. If one good has a negative price, and the other good has a positive price, then the slope of the budget constraint will be positive. is this true or false?A consumer consumes two agricultural products: Red Meat, and Tomatoes according to the following utility function: U = RT That is, the total utility is the multiplication of the quantity consumed of the two products. Given that consumer's income is 210, price of R is 10, and the price of Tis 2, a)Write down the budget constraint (budget line equation) for this consumer. b)Determine the quantities that the consumer should consume of each of the two products c)Calculate the value of the lagrangian multiplier and derive the demand function for Red Meat and for tomatoes.
- Biwei’s utility function U=4XY, where X is consumption of beer and Y is consumption of pizza. For this utility function, the marginal utility of X is MUx = 4Y; the marginal utility of Y is MUY = 4X. 1) Suppose Y = 3. Calculate Biwei’s utility for X = 2, 3, 10, and 11. For a given level of Y, does good X display diminishing marginal utility? 2) Suppose X = 3. Calculate Biwei’s utility for Y = 2, 3, 10, and 11. For a given level of X, does good Y display diminishing marginal utility?Anna has an income of 1000 euros and utility function U(x,y)=x²y³. The prices of the two goods are P₁=5 and Py-20. a) Define the budget constraint and represent it graphically. (suppose a consumer consumes two goods x and y with utility function u=x^0.5+y^1.5, does the utility funciton exhibit diminishing marginal utility for (i) x (ii)y?
- Consider a consumer whose utility function is (screenshot) Assume the consumer has income $120 and initially faces the prices px=$1 and py=$1. How much x and y would they buy? Draw the budget constraint and the demands.Assume that a person's utility function is given by the following function: TU = 2x/2y/2 Assume also that the price of X is £2, and the price of Y is £6 and that the budget is £240. What is the optimal amount of goods X and Y that should be purchased with this budget?A consumer has an income of $400 and is deciding between two products: X and Y. Assume that the X product is the horizontal axis product. The price of X is $10 and the price of Y is $2. Assume the consumer currently wants to consume 50 units of product Y to maximize his utility. a) Write out the equation to this consumers budget line. What is the slope to this budget constraint? b) How much of X and Y will the consumer consume to maximize his utility subject to his budget constraint. C) Now assume the price of X changes to $5 and price of Y and Income stays the same. At the new price, the consumer wants to buy 60 units of product X to maximize her utility given her budget. How much X and Y will the consumer consume to maximize utility. g in the before and after the change of the budget constraint and indifference graph on the same graph space. Show all necessary points. Label clearly. ead oubstitutiofs. Draw d) Write out the expression of the utiiity maximizing ruie here.?
