Question

Blake has a utility function U =X‾‾√ + YU =X + Y. If Blake consumes 9 units of good x and 2 units of good y, she would get the same utility when she consumes 16 units of good x and ________ OR _________ and 3 units of good y.

Question 16 options:

	2 units of good y; 4 units of good x
	2 units of good y; 3 units of good x
	1 unit of good y; 4 units of good x
	1 unit of good y; 3 units of good x

Answer 1

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Blake has a utility function U =√ X + Y

If Blake consumes 9 units of good x and 2 units of good y the utility will be =>

U = √9 + 2 = 3+2 = 5

she would get the same utility when she consumes 16 units of good x, then units of y she consumed are-

5 = √16 + y

5 = 4+y

y = 5-4 = 1

she would get the same utility when she consumes 3 units of good x, then units of x she consumed are-

5 =  √x +3

√x = 5-3

√x = 2

x = (2)2 = 4

So,1 unit of good y; 4 units of good x is the right answer.

Option, 3) is correct.