4. A consumer lives on an island where she produces two goods, x and y according to production possibility frontier: x² + y² ≤ 200, and she consumes all the goods herself. Her utility function is U = xy³. She also faces an environmental constraint on her production as x + y ≤ 20. (a) Find her optimal x and y. (b) Check whether the sufficient conditions are satisfied at the x and y you found.

4. A consumer lives on an island where she produces two goods, x and y according to production possibility frontier: x² + y² ≤ 200, and she consumes all the goods herself. Her utility function is U = xy³. She also faces an environmental constraint on her production as x + y ≤ 20. (a) Find her optimal x and y. (b) Check whether the sufficient conditions are satisfied at the x and y you found.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter13: General Equilibrium And Welfare

Section: Chapter Questions

Problem 13.1P

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