1) Suppose that Irma, when on her lunch break always chooses between bur- ritos and sushi to eat for lunch. One day she realized when going over her budget that year on year she spends 40% of her lunch budget on burritos and 60% on sushi. a) What kind of utility function would best describe Irma's preferences? b) Given your answer to a) formally right down Irma's utility maximization problem using the information provided defining burritos as b and sushi as s and their respective prices as p, and p, and income as y. c) Can you derive the demand functions for burritos and sushi for Irma? What are they? d) Suppose I told you Irma spent $1000 on lunch last year, solve for the price
1) Suppose that Irma, when on her lunch break always chooses between bur- ritos and sushi to eat for lunch. One day she realized when going over her budget that year on year she spends 40% of her lunch budget on burritos and 60% on sushi. a) What kind of utility function would best describe Irma's preferences? b) Given your answer to a) formally right down Irma's utility maximization problem using the information provided defining burritos as b and sushi as s and their respective prices as p, and p, and income as y. c) Can you derive the demand functions for burritos and sushi for Irma? What are they? d) Suppose I told you Irma spent $1000 on lunch last year, solve for the price
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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The question is in the attached image. Thank you!
![1) Suppose that Irma, when on her lunch break always chooses between bur-
ritos and sushi to eat for lunch. One day she realized when going over her
budget that year on year she spends 40% of her lunch budget on burritos
and 60% on sushi.
a) What kind of utility function would best describe Irma's preferences?
b) Given your answer to a) formally right down Irma's utility maximization
problem using the information provided defining burritos as b and sushi as s
and their respective prices as p, and p, and income as y.
c) Can you derive the demand functions for burritos and sushi for Irma?
What are they?
d) Suppose I told you Irma spent $1000 on lunch last year, solve for the price
of a burrito or sushi lunch.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdfedcf45-36f9-41dd-be80-a8990833e266%2F331c6eb6-a4e0-43a6-a95e-36c4ec6af13d%2Fuxh23n5_processed.png&w=3840&q=75)
Transcribed Image Text:1) Suppose that Irma, when on her lunch break always chooses between bur-
ritos and sushi to eat for lunch. One day she realized when going over her
budget that year on year she spends 40% of her lunch budget on burritos
and 60% on sushi.
a) What kind of utility function would best describe Irma's preferences?
b) Given your answer to a) formally right down Irma's utility maximization
problem using the information provided defining burritos as b and sushi as s
and their respective prices as p, and p, and income as y.
c) Can you derive the demand functions for burritos and sushi for Irma?
What are they?
d) Suppose I told you Irma spent $1000 on lunch last year, solve for the price
of a burrito or sushi lunch.
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