Assume that the prices of good X, Y and Z are as follows R5,R1 and R4 respectively, and the Judith has an income of R37 to spend. HOW much of each good will judith consume in order to maximise her utility? What will be her total utility and marginal utility of the last rand spent on each good?
Q: Let x be the number of pizza slices and y the number of Cokes. If John’s utility function is u =…
A: Two goods are perfect complements when they are consumed in fixed proportion and are consumed…
Q: Suppose that a consumer’s marginal rate of substitution at her current chosen bundle is MUx / MUY =…
A: Marginal rate of substitution is the amount of one good that the consumer is willing to consume in…
Q: Rasheed's utility function for goods X and Y is U(XY) 2XYY Let Py and Py be the prices for goods X…
A: Answer -Given in the question -U(X.Y) = 2XY + Y................................(1)Price of good "X"…
Q: Suppose Ming spends his entire income on two goods, X and Y, has "standard-looking" indifference…
A: We have two goods X and Y where price of good X falls
Q: Consider a consumer with preferences defined over x and y. Demonstrate that it is possible they…
A: It is possible that a consumer would choose to consume some of the both commodities when their…
Q: Suppose that a fast-food junkie derives utility from three goods-soft drinks (x), hamburgers (y),…
A: U(x,y,z)=x0.5y0.5(1+z)0.5 where Px = 1 Py = 4 Pz = 8 Income = 8
Q: A consumer finds only three products, X, Y, and Z, are for sale. The amount of utility which their…
A: Utility maximization formula: MUxPx=MUyPy=MUzPz, where, MUx is the marginal utility of good X, Px is…
Q: Suppose Mika has budget of $600 for only two goods, x and y. The price of a Good X is $10 and the…
A: The ability of a good to fulfill human needs is demonstrated by its utility. The utility function…
Q: Derive Ryan's demand function for q₁, given his utility function is U= (9₁) P + (92) P₁ where o Let…
A: Given Utility function: U=q1ρ+q2ρ ....(1) The price of q1 is p1 and price of q2 is p2.…
Q: Suppose you find that MU1(x1+x₂)=2x2 and MU₂(x1+x₂)=2x1. What is the rate at which the consumer is…
A: Marginal Rate of substitution refers to the rate at which a certain consumer is willing to give up…
Q: 2. Assume you spend your entire income on two goods X & Y with prices given as Px & Py,…
A: We minimize the expenditure function given the utility and find the hicksian demand functions. We…
Q: Suppose Karpov also enjoys eating nuts and berries. His utility function is…
A: The utility function is a key concept in economics that quantifies preferences across a range of…
Q: Suppose Emma consumes only two goods, X1 and X2, and her utility function is given by U=5X1X2.…
A: U=5X1X2
Q: Columns 1 through 4 of the accompanying table show the marginal utility, measured in utils, that…
A: At this point, when the marginal utility from one good for each its price is equivalent to the…
Q: consumer endowed with a positive net income m. If the unit prices of goods are p1 and p2 with p1=2p2…
A: *Answer:
Q: Suppose utility can be measured by "utils" and that Jane is consuming both lemons and cookies. The…
A: The satisfaction derived from the consumption of a product is called utility. Utility function is…
Q: 17) Assume a consumer has $40 to spend and for both products the marginal utilities are shown in the…
A: Consumer preference is outlined as a group of assumptions that specialise in client selections that…
Q: The second half of the question
A: The marginal rate of substitution (MRS) is the rate at which consumers can give up quantity of good…
Q: Suppose that U = min{2X, Y}, where X is units of good X and Y is units of good Y. The price of good…
A: Given utility function is type of Perfect Complement utility function. U = min{2X,Y} also Prices of…
Q: Miles is an engineering student who uses all his income to buy instant coffee and food. Miles's…
A:
Q: Columns 1 through 4 of the accompanying table show the marginal utility, measured in utils, that…
A: a. The utility maximization is possible when the individual consumes a combination of goods from the…
Q: You are choosing between two goods, X and Y, and your marginal utility from each is as shown below.…
A: Dear student, you have asked multiple sub-part questions in a single post. In such a case, I will be…
Q: Faa's utility function for coffee (good X) and muffins (good Y) is given as U(x,y) = x0.5y0.5. If…
A: Answer: Given, Utility function: Ux,y=x0.5y0.5 IncomeM=$192Px=8Py=16 At equilibrium the following…
Q: Two individuals, Amir and Budi, consume two goods, clothes (X) and shoes (Y). The utility functions…
A: Given the two good and two consumer economy: Utility function: For Amir (A): UA= 15XA0.25YA0.75 For…
Q: 1.Suppose that Chris's utility function is given by UC=QC1/2 RC1/2 , where QC and RC are his…
A: Answer -
Q: the price of Yoghurts increase to GHS10? d. Assume that prices are the same as used in part a. If…
A: d. Price of Yogurt = GHS 8 Price of Bread = GHS 2 MU of Yogurt = 20 MU of Bread = x For utility…
Q: Joan has a monthly income of €100 that she allocates to two goods: meat and potatoes. Suppose meat…
A: U (M, P) = 2M + P Budget constraint of the consumer will be: I=2M+P PM=€4 PP= €2 I=100 P'P= €4
Q: Suppose that good 1 has price pi = 4 and good 2 has price p2 = 1. Anne's utility function over goods…
A: Given U(x1,x2) =2x1+3ln(x2) ......... (1) P1 = 4 and P2 = 1 , m be the income Budget line…
Q: John has a utility function for goods x1 and x2 which is represented by u(x1,x2)=x10.2x20.8. Assume…
A: A. The Cobb-Douglas utility function is given as follows: U(x1, x2) = x1a x2b The optimal…
Q: Suppose an individual has preferences over goods x and y, and their expenditure minimization problem…
A: The change in price of a good leads to change in quantity demanded of the good. This change in…
Q: olumns 1 through 4 of the accompanying table show the marginal utility, measured in utils, that…
A: choice Potential choices MU/P DECISION LEFT OVER INCOME 1 FIRST UNIT OF A 4 BUY FIRST UNIT OF A…
Q: identical incomes I. Their preferences can be described by the utility functions Ut = min {x1, x2}…
A: Ut=min(x1,x2) Uj=x1x2 1) Let their budget constraint be : p1x1+p2x2=I p1 and p2 are same. Given…
Q: Pankti consumes two goods, x and y. Her utility function is given by U(x, y) = ln(xy). (a) Suppose…
A: Pankti consumes two goods, x, and y. Let, the utility function be- U(x,y) = In(xy) a) If the income…
Q: A consumer finds only three products, X, Y, and Z, are for sale. The amount of utility which their…
A: For Combination X=2, Y=4 and Z=1
Q: Assume in the market with two consumers, Chloe and Oliver. Chloe's utility function is U(x, y) = x +…
A: When no changes to the economy can make one person better off without making at least one other…
Q: In the bread market, Maria buys different amounts of bread conditional on whether the price is $2,…
A: Demand curve shows different combinations of price and quantity demanded.
Q: Monica consumes only goods A and B. Suppose that her marginal utility from consuming good A is equal…
A: At equilibrium level of consumption bundle, MUA/MUB = MRS 1/11/2=2 At this bundle, Monica should buy…
Q: You are choosing between two goods, X and Y, and your marginal utility from each is shown in the…
A: Hey, since there are multiple subparts posted, we will answer the first three subpart question.
Q: Suppose Ming spends his entire income on two goods, X and Y, has "standard-looking" indifference…
A: The intermediate or final process through which institutional entities consume things or services is…
Q: An individual's utility function is given by: U (q1 , q2) = q11/2 . q2 Suppose we know that the…
A: The consumer is consuming two goods. In case of two goods, consumption is optimized when marginal…
Q: Suppose Olivia has an income of $800/week for which she can use to consume two goods: entertainment…
A:
Q: Suppose that a consumer's marginal rate of substitution at her current chosen bundle is MUx/MUy=3…
A: The marginal rate of substitution (MRS) is the slope of the indifference curve (in the question is…
Q: For Gil, apples and pears are perfect substitutes; one apple is equivalent to one pear. Suppose, Gil…
A: consumer equilibrium (max utility) is determined at point where slope of budget constraint of…
Q: Imagine two goods, x and y, with a given budget of 10 pesos. Prices of good x and y are P2 and P3…
A: Budget Constraints refer to all possible combinations of goods that a consumer can afford at given…
Q: Suppose that Omar’s marginal utility for cups of coffee is constant at 1.5 utils per cup no matter…
A: To address this inquiry, we first need to figure the marginal utility per dollar for doughnuts.…
Q: Suppose you find that MU1(X1Xx2)=2x2 and MU₂(x1+x₂)=2x1. What is the rate at which the consumer is…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Assume that the prices of good X, Y and Z are as follows R5,R1 and R4 respectively, and the Judith has an income of R37 to spend. HOW much of each good will judith consume in order to maximise her utility? What will be her total utility and
Step by step
Solved in 2 steps
- You are choosing between two goods, X and Y, and your marginal utility from each is as shown in the table below. If your income is $9 and the prices of X and Y are $2 and $1, respectively, what quantities of each will you purchase to maximize utility? What total utility will you realize? Assume that, other things remaining unchanged, the price of X falls to $1. What quantities of X and Y will you now purchase? Using the two prices and quantities for X, derive a demand schedule (price–quantity-demanded table) for X.Q.7 A consumer's utility function is given by the expression: U = (0.6A"' + 0.47'"s} Determine the marginal utility functions for each commodity. Does marginal utility decrease when consumption increases? Assuming that the price of good X is Rs 15 and the price of Y is Rs 6, write the equation of the budget line and plot it when income is Rs 450. What is its slope? What does it indicate? Calculate the marginal rate of substitution of Y for X and interpret its economic meaning. Write the equation showing consumer's equilibrium condition. Obtain the equilibrium values of X and Y. Find the expressions for change in MUx due to increase in Y and change in MUy due to increase in X.You are choosing between two goods, X and Y, and your marginal utility from each is as shown in the following table. If your income is $9 and the prices of X and Y are $2 and $1, respectively, what quantities of each will you purchase to maximize utility? What total utility will you realize? Assume that, other things remaining unchanged, the price of X falls to $1. What quantities of X and Y will you now purchase? Using the two prices and quantities for X, derive a demand schedule (a table showing prices and quantities demanded) for X.
- 3. Suppose Mary enjoys Pepsi and Coke according to the functionU(P;C) = 4C + 5P. What does her utility function say about her MRS of Coke for Pepsi? What do her indi§erence curves look like? What type of goods are Pepsi and Coke for Mary? If Pepsi and Coke each cost $1 and Mary has $20 to spend on these products, how many units of each product should she buy in order to maximize her utility? Show this utility maximiz- ing combination combination of Pepsi and Coke on the graph. how would her consumption and utility maximizing bundle of Coke and Pepsi change if the price of Coke decreases to 50 cents. 4. Vera is an impoverished graduate student who has only $100 a month to spend on food. She has read in a government publication that she can assure an adequate diet by eating only peanut butter and carrots in the Öxed ratio of 2 pounds of peanut butter to 1 pound of carrots, so she decides to limit her diet to that regime. a) If peanut butter costs $4 per pound and carrots cost $2 per…QUESTION ONE The only source of income available to Doreen, a level 200 student of UEW is her monthly stipend (M) from her parents. She neither saves nor borrows. Assuming she spends all her income on only two goods food (F) and Clothes (C), with Pr and Pc being the prices of the two goods respectively and having a utility function of the form: U = 6F°C i. Write an expression for Doreen's budget constraint. ii. Assuming good Fis on the vertical axis, produce a sketch of her budget constraint and determine the slope. iii. Find Doreen's monthly equilibrium demand functions for both goods. iv. With Pr and Pcgiven as ¢12 and ¢15 respectively and income of ¢300, calculate the equilibrium quantities of both goods. v. Compute the price elasticity of demand for both goods and interpret your results. vi. If income and prices of the two goods increase by 50%, calculate the equilibrium quantities of Food and Clothing.In two commodities world, utility function for a consumer and her income are given respectively. 11 U = x2y2 I= 480 If the price of these goods are Px= 15 and P, = 60 what would be her demand for these two goods * =? and y =? If the price of first good P has increased from 15 to 60. To keep her utility fixed how much does she need to spend for these two goods at least. In other words what should be her minimum income.
- Guerdon always puts half a sliced banana, q, , on his bowl of cereal, q, The two 14 goods are perfect complements. What is his utility function? Derive his demand curve for bananas graphically and mathematically. 12- 10- e, Guerdon's utility function (as a function of q, and q2) is 6- VA U= min/2q1.92} 4- O B. U=q, +92- 2- 0+ OC. U=29, + q92- 10 12 14 16 18 20 6 22 Bananas O D. U=0.5q1 + q2- OE. U=q, xq2- 5.00- 4.50- Guerdon's demand function for bananas (as a function of the price of bananas, P1. the price of a bowl of cereal, p2, and income, Y) is 4,00- 3.50- 91 = (p1 + 2p2) (Properly format your expression using the tools in the E 3.00 palette. Hover over tools to see keyboard shortcuts. E.g., a subscript can be created with the_ character.) 2.50- * 2.00- P. 1.50- 1.00- 0.50- 0.00+ 10 12 14 Bananas tv 80 DI DD F1 F3 F4 F5 F6 F7 F8 F10 @ %23 $ & 1 3 4 7 Q W E Y U S F H. J く C V M option command command optic ーの * CO Cereal (bowls) p. S per banana B * * N AFind the marginal rate of substitution given the following utility functions for x and y: U(x) = 2xy U(y) = 3x1/3,2/3 O x1/3 / yA/3 O 213 x213y1/3 y2/3 / x1/3 'yA/3 /x1/3John likes Coca-Cola. After consuming one Coke, John has a total utility of 10 utils. After two Cokes, he has a total utility of 25 utils. After three Cokes, he has a total utility of 50 utils. Does John show diminishing marginal utility for Coke or does he show increasing marginal utility for Coke? Suppose that John has $3 in his pocket. If Cokes cost $1 each and John is willing to spend one of his dollars on purchasing a first can of Coke, would he spend his second dollar on a Coke, too? What about the third dollar? If John’s marginal utility for Coke keeps on increasing no matter how many Cokes he drinks, would it be fair to say that he is addicted to Coke? *use tables and/or graphs if possible, please original work
- Suppose utility can be measured by "utils" and that Jane is consuming both lemons and cookies. The marginal utility from the last lemon consumed was 8 utils whereas the marginal utility from the last cookie consumed was 16 utils. Is it possible that Jane is maximizing total utility given the current combination of lemons and cookies consumed? Describe in detail what relationship would have to hold between the prices of lemons and cookies in order for Jane to be currently maximizing total utility.Q.7 A consumer's utility function is given by the expression: U = (0.6Xx5 + 0.4Y5). • Determine the marginal utility functions for each commodity. Does marginal utility decrease when consumption increases? Assuming that the price of good X is Rs 15 and the price of Y is Rs 6, write the equation of the budget line and plot it when income is Rs 450. What is its slope? What does it indicate? Calculate the marginal rate of substitution of Y for X and interpret its economic meaning. Write the equation showing consumer's equilibrium condition. Obtain the equilibrium values of X and Y. Find the expressions for change in MUx due to increase in Y and change in MUy due to increase in X.Your sister’s utility function over the 2 goods X and Y is defined by: U (X,Y) = XY +4Y a. If she originally consumed 10 units of X and 24 units of Y, and if the consumption of X were increased to 12 units, how much Y would she be willing to give up and maintain the initial level of satisfaction? That is, how much less Y is needed in exchange for the increase in the consumption of X if she is to be equally satisfied before and after the change occurs? b. On a carefully constructed graph (you only need to consider X and Y values up to 50), indicate your sister’s original consumption position, with X plotted on the horizontal axis and Y on the vertical axis. Draw her indifference curve through the original consumption bundle from part a. As you can verify (or have already verified), she is indifferent to the points (10,24) and (12,21). If you double the amount of each good in these two consumption bundles, you would have the bundles (20,48) and (24,42). Since the two original bundles…