13) Suppose you have two different job offers. The first offer is in LA and pays $8100 per month. The price of food (F) in LA is $2 and the price of housing (H) is $12. The second offer is in San Francisco and pays $9600. Both food and housing are more expensive in SF at PF = 3 and PH = 14 respectively. If your utility function is U (F, H) = FO.3 H 0.7 which job offer should you accept?

13) Suppose you have two different job offers. The first offer is in LA and pays $8100 per month. The price of food (F) in LA is $2 and the price of housing (H) is $12. The second offer is in San Francisco and pays $9600. Both food and housing are more expensive in SF at PF = 3 and PH = 14 respectively. If your utility function is U (F, H) = FO.3 H 0.7 which job offer should you accept?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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13) Suppose you have two different job offers. The first offer is in LA and pays $8100 per month.
The price of food (F) in LA is $2 and the price of housing (H) is $12. The second offer is in San
Francisco and pays $9600. Both food and housing are more expensive in SF at PF = 3 and PH = 14
respectively. If your utility function is U (F, H) = F0.3 H 0.7 which job offer should you accept?

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