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1. Suppose a consumer has a utility function given by u(x1, x2) = xỉx2. a. Compute the marginal rate of substitution (MRS) of this consumer. b. Suppose another consumer has a utility function v(x1,x2) = 2 In(x1) Compute this consumer's MRS. c. Do u and v represent the same preferences? Why/why not?

1. Suppose a consumer has a utility function given by u(x1, x2) = xỉx2. a. Compute the marginal rate of substitution (MRS) of this consumer. b. Suppose another consumer has a utility function v(x1,x2) = 2 In(x1) Compute this consumer's MRS. c. Do u and v represent the same preferences? Why/why not?

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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1. Suppose a consumer has a utility function given by u(x1,X2) = xỉx2. %3D a. Compute the marginal rate of substitution (MRS) of this consumer. b. Suppose another consumer has a utility function v(x1,X2) = 2 lIn(x1) + In Compute this consumer's MRS. c. Do u and v represent the same preferences? Why/why not?
Transcribed Image Text:1. Suppose a consumer has a utility function given by u(x1,X2) = xỉx2. %3D a. Compute the marginal rate of substitution (MRS) of this consumer. b. Suppose another consumer has a utility function v(x1,X2) = 2 lIn(x1) + In Compute this consumer's MRS. c. Do u and v represent the same preferences? Why/why not?
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