Pls help with thsi question Consider an Individual who buys films (F) and books (B) with the following utility function: ?(?, ?) = 5? + 2? This individual also has the following incomes (m) and prices (pF and pB): ? = $50, ?f= $5, ?b= $10 Given the above: 1) Draw the utility functions for utility levels of 10 and 20. Draw these with films on the x- axis and books on the y-axis. 2) What is the MRS for these utility functions? Assume that films remain on the x-axis and books remain on the y-axis. 3) What is the consumption bundle that delivers the highest level of utility that is also affordable?
Pls help with thsi question Consider an Individual who buys films (F) and books (B) with the following utility function: ?(?, ?) = 5? + 2? This individual also has the following incomes (m) and prices (pF and pB): ? = $50, ?f= $5, ?b= $10 Given the above: 1) Draw the utility functions for utility levels of 10 and 20. Draw these with films on the x- axis and books on the y-axis. 2) What is the MRS for these utility functions? Assume that films remain on the x-axis and books remain on the y-axis. 3) What is the consumption bundle that delivers the highest level of utility that is also affordable?
Chapter3: Preferences And Utility
Section: Chapter Questions
Problem 3.7P
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Pls help with thsi question
Consider an Individual who buys films (F) and books (B) with the following utility function:
?(?, ?) = 5? + 2?
This individual also has the following incomes (m) and prices (pF and pB):
? = $50, ?f= $5, ?b= $10
Given the above:
1) Draw the utility functions for utility levels of 10 and 20. Draw these with films on the x-
axis and books on the y-axis.
2) What is the MRS for these utility functions? Assume that films remain on the x-axis and
books remain on the y-axis.
3) What is the consumption bundle that delivers the highest level of utility that is also
affordable?
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