1.a Assume that a person’s utility function is given by the following function: ??=3?^(2/3)?^(1/3) Assume also that the price of X is £3, and the price of Y is £3 and that the budget is £45. What is the optimal amount of goods X and Y that should be purchased with this budget? b) Assume now that the price of good X is PD, while all other conditions remain the same. Find the optimal amount of good X that should be purchased for a generic price PD. In other words, find the individual demand function for good X. 1.b Assume now that the price of good X is PD, while all other conditions remain the same. Find the optimal amount of good X that should be purchased for a generic price PD. In other words, find the individual demand function for good X.

1.a Assume that a person’s utility function is given by the following function: ??=3?^(2/3)?^(1/3) Assume also that the price of X is £3, and the price of Y is £3 and that the budget is £45. What is the optimal amount of goods X and Y that should be purchased with this budget? b) Assume now that the price of good X is PD, while all other conditions remain the same. Find the optimal amount of good X that should be purchased for a generic price PD. In other words, find the individual demand function for good X. 1.b Assume now that the price of good X is PD, while all other conditions remain the same. Find the optimal amount of good X that should be purchased for a generic price PD. In other words, find the individual demand function for good X.

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter6: Consumer Choice And Demand

Section: Chapter Questions

Problem 6QFR

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Question

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1.a Assume that a person’s utility function is given by the following function:

??=3?^(2/3)?^(1/3)

Assume also that the price of X is £3, and the price of Y is £3 and that the budget is £45.

What is the optimal amount of goods X and Y that should be purchased with this budget?

b) Assume now that the price of good X is P_D, while all other conditions remain the same. Find the optimal amount of good X that should be purchased for a generic price P_D. In other words, find the individual demand function for good X.

1.b Assume now that the price of good X is P_D, while all other conditions remain the same. Find the optimal amount of good X that should be purchased for a generic price P_D. In other words, find the individual demand function for good X.

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