Allen has a utility function U=xy², where x is the consumption of apples and y is theconsumption of bananas. Price of apple is 1 and price of bananas is 4. Allen has 30 dollars in hispocket, so how many apples and bananas will he purchase to maximize his utility?options:10 apples and 5 bananas.3 apples and 10 bananas.30 apples only.none of above.

Budget Constraint: Allen has a budget of $30. Let x be the number of apples and y be the number of…

Answered: Allen has a utility function U=xy²,…

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter6: Consumer Choice Theory

Section: Chapter Questions

Problem 16SQ

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