ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Pls help with thsi question I am stuck
Given the image attatched:
1.Given the above
maximization. According to this optimality condition, what must be the ratio of Films to
Books in an optimal consumption bundle?
2. Given your answer to Q9, what must be the household’s optimal consumption of F & B
given their income (m)?
3. Suppose that the
the MRS according to the optimality condition in Q9 if the household wanted to keep
maximizing its utility?
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- K Paul consumes only books and DVDs. At his current consumption bundle, his marginal utility from DVDS is 25 and from books is 3. Each DVD costs $13, and each book costs $2. Is he maximizing his utility? Explain. Let MUB be the marginal utility of books, MUD be the marginal utility from DVDs, PB be the price of books, Pp be the price of DVDs, and MRS be the marginal rate of substitution. Paul is OA. maximizing his utility because MUB PB = MUD PD MUB MUD OB. not maximizing his utility because < PB PD MUB OC. maximizing his utility because MRS = MUD MUB MUD OD. maximizing his utility because < PB PD MUB O E. not maximizing his utility because MRS < MUD If he is not, how can he increase his utility while keeping his total expenditure constant? Paul could increase utility while keeping total expenditures constant by consuming more and fewerarrow_forwardTyped plz and Asap thanksarrow_forward
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