Question

A consumer has utility function U(x, y) = x + 4y1/2 . What is the consumer’s...

A consumer has utility function U(x, y) = x + 4y1/2 . What is the consumer’s demand function for good x as a function of prices px and py, and of income m, assuming a corner solution?

Group of answer choices

a.x = (m – 3px)/px

b.x = m/px – 4px/py

c.x = m/px

d.x = 0

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Suppose a consumer has the utility function U (x, y) = xy + x + y....
Suppose a consumer has the utility function U (x, y) = xy + x + y. Recall that for this function the marginal utilities are given by MUx(x,y) = y+1 and MUy(x,y) = x+1. (a) What is the marginal rate of substitution MRSxy? (b)If the prices for the goods are px =$2 and py =$4,and if the income of the consumer is M = $18, then what is the consumer’s optimal affordable bundle? (c) What if instead the prices are...
Suppose a consumer has the utility function u(x, y) = x + y. a) In a...
Suppose a consumer has the utility function u(x, y) = x + y. a) In a well-labeled diagram, illustrate the indifference curve which yields a utility level of 1. (b) If the consumer has income M and faces the prices px and py for x and y, respectively, derive the demand functions for the two goods. (c) What types of preferences are associated with such a utility function?
8) Suppose a consumer’s utility function is defined by u(x,y)=3x+y for every x≥0 and y≥0 and...
8) Suppose a consumer’s utility function is defined by u(x,y)=3x+y for every x≥0 and y≥0 and the consumer’s initial endowment of wealth is w=100. Graphically depict the income and substitution effects for this consumer if initially Px=1 =Py and then the price of commodity x decreases to Px=1/2.
Suppose a consumer’s Utility Function U(x,y) = X1/2Y1/2. The consumer wants to choose the bundle (x*,...
Suppose a consumer’s Utility Function U(x,y) = X1/2Y1/2. The consumer wants to choose the bundle (x*, y*) that would maximize utility. Suppose Px = $5 and Py = $10 and the consumer has $500 to spend. Write the consumer’s budget constraint. Use the budget constraint to write Y in terms of X. Substitute Y from above into the utility function U(x,y) = X1/2Y1/2. To solve for the utility maximizing, taking the derivative of U from (b) with respect to X....
Consider a consumer with the utility function U(x, y) = min(3x, 5y). The prices of the...
Consider a consumer with the utility function U(x, y) = min(3x, 5y). The prices of the two goods are Px = $5 and Py = $10, and the consumer’s income is $220. Illustrate the indifference curves then determine and illustrate on the graph the optimum consumption basket. Comment on the types of goods x and y represent and on the optimum solution.
Suppose a consumer’s utility function is given by U(X,Y) = X*Y. Also, the consumer has $360...
Suppose a consumer’s utility function is given by U(X,Y) = X*Y. Also, the consumer has $360 to spend, and the price of X, PX = 9, and the price of Y, PY = 1. a) (4 points) How much X and Y should the consumer purchase in order to maximize her utility? b) (2 points) How much total utility does the consumer receive? c) (4 points) Now suppose PX decreases to 4. What is the new bundle of X and...
Consider a consumer with the utility function U(x, y) =2 min(3x, 5y), that is, the two...
Consider a consumer with the utility function U(x, y) =2 min(3x, 5y), that is, the two goods are perfect complements in the ratio 3:5. The prices of the two goods are Px = $5 and Py = $10, and the consumer’s income is $330. At the optimal basket, the consumer buys _____ units of y. The utility she gets at the optimal basket is _____ At the basket (20, 15), the MRSx,y = _____.
Suppose a consumer has the utility function u(x,y)=x+y - (a) In a well labelled diagram illustrate...
Suppose a consumer has the utility function u(x,y)=x+y - (a) In a well labelled diagram illustrate the indifference curve which yields a utility level of 1 (b) If the consumer has income And faces the prices Px and Py for x and y, respectively, derive the demand function for the two goods (c) What types of preferences are associated with such a utility function?
1. Suppose utility for a consumer over food(x) and clothing(y) is represented by u(x,y) = 915xy....
1. Suppose utility for a consumer over food(x) and clothing(y) is represented by u(x,y) = 915xy. Find the optimal values of x and y as a function of the prices px and py with an income level m. px and py are the prices of good x and y respectively. 2. Consider a utility function that represents preferences: u(x,y) = min{80x,40y} Find the optimal values of x and y as a function of the prices px and py with an...
Consider a consumer with the following utility function: U(X, Y ) = X1/2Y 1/2 (a) Derive...
Consider a consumer with the following utility function: U(X, Y ) = X1/2Y 1/2 (a) Derive the consumer’s marginal rate of substitution (b) Calculate the derivative of the MRS with respect to X. (c) Is the utility function homogenous in X? (d) Re-write the regular budget constraint as a function of PX , X, PY , &I. In other words, solve the equation for Y . (e) State the optimality condition that relates the marginal rate of substi- tution to...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT