Suppose an individual has a utility function u (x1, x2) = 2*2. Present your mathmatical expressions below in the simplest form you can. a) Derive an expression for the marginal utility of good 1, and for the marginal utility of good 2. b) Using these, solve for an expression describing the slope of an indifference curve: MRS (11, 12). c) Sketch indifference curves for this consumer corresponding to u = 0,10,20. (Hint: z rı = k solves for m} = 11 (21) . Solve this expression and approximate it on a graph for the three values of k.)
Suppose an individual has a utility function u (x1, x2) = 2*2. Present your mathmatical expressions below in the simplest form you can. a) Derive an expression for the marginal utility of good 1, and for the marginal utility of good 2. b) Using these, solve for an expression describing the slope of an indifference curve: MRS (11, 12). c) Sketch indifference curves for this consumer corresponding to u = 0,10,20. (Hint: z rı = k solves for m} = 11 (21) . Solve this expression and approximate it on a graph for the three values of k.)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Suppose an individual has a utility function u (x1, x2) = 2*2. Present your mathmatical expressions below in the simplest form you can.
a) Derive an expression for the
b) Using these, solve for an expression describing the slope of an indifference curve: MRS (11, 12).
c) Sketch indifference curves for this consumer corresponding to u = 0,10,20. (Hint: z rı = k solves for m} = 11 (21) . Solve this expression and approximate it on a graph for the three values of k.)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education