Homework Help is Here – Start Your Trial Now!
Business
Economics
3. Suppose that Lisa likes noodles x, and porridge x,, and her preferences are described by 1 a b the following utility function :U (x,, x,) = xx,. Find the following variables: 1 2 A. The optimal fraction (percentage) of income spent on porridge. B. The optimal amount of total cash (dollars) spent on porridge. C. The optimal quantity of noodles consumed. D. The slope of the indifference curve at the optimal bundle for the following values of parameters: a). a = 4, b = 8, p 5, p 10, m = 60 %3D b), a=글,6-3,p 1-4, p ,= 1, m = 12 %3D 2 c). a = , b = .p 1- 5, p ,= 1, m= 20 Hint: Calculating optimal choices using the demand formulas for Cobb Douglas Utility Function.

3. Suppose that Lisa likes noodles x, and porridge x,, and her preferences are described by 1 a b the following utility function :U (x,, x,) = xx,. Find the following variables: 1 2 A. The optimal fraction (percentage) of income spent on porridge. B. The optimal amount of total cash (dollars) spent on porridge. C. The optimal quantity of noodles consumed. D. The slope of the indifference curve at the optimal bundle for the following values of parameters: a). a = 4, b = 8, p 5, p 10, m = 60 %3D b), a=글,6-3,p 1-4, p ,= 1, m = 12 %3D 2 c). a = , b = .p 1- 5, p ,= 1, m= 20 Hint: Calculating optimal choices using the demand formulas for Cobb Douglas Utility Function.

Microeconomic Theory
Microeconomic Theory
12th Edition
ISBN:9781337517942
Author:NICHOLSON
Publisher:NICHOLSON
Chapter4: Utility Maximization And Choice
Section: Chapter Questions
Problem 4.4P
See similar textbooks
icon
Related questions
Question
This question on the below (screenshot)
3. Suppose that Lisa likes noodles and porridge x2» and her preferences are described by the following utility function :U (x, ,x,) a b Find the following variables: %3D 1' A. The optimal fraction (percentage) of income spent on porridge. B. The optimal amount of total cash (dollars) spent on porridge. C. The optimal quantity of noodles consumed. D. The slope of the indifference curve at the optimal bundle for the following values of parameters: a). a = 4, b = 8, p ,=5, p 10, m = 60 b). a = , b=,p = 4, p ,= 1, m = 12 1 %3D 2 c). a = , b =p 5, р = 1, m = 20 Hint: Calculating optimal choices using the demand formulas for Cobb Douglas Utility Function.
Transcribed Image Text:3. Suppose that Lisa likes noodles and porridge x2» and her preferences are described by the following utility function :U (x, ,x,) a b Find the following variables: %3D 1' A. The optimal fraction (percentage) of income spent on porridge. B. The optimal amount of total cash (dollars) spent on porridge. C. The optimal quantity of noodles consumed. D. The slope of the indifference curve at the optimal bundle for the following values of parameters: a). a = 4, b = 8, p ,=5, p 10, m = 60 b). a = , b=,p = 4, p ,= 1, m = 12 1 %3D 2 c). a = , b =p 5, р = 1, m = 20 Hint: Calculating optimal choices using the demand formulas for Cobb Douglas Utility Function.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 4 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Microeconomic Theory
Microeconomic Theory
Economics
ISBN:
9781337517942
Author:
NICHOLSON
Publisher:
Cengage
Micro Economics For Today
Micro Economics For Today
Economics
ISBN:
9781337613064
Author:
Tucker, Irvin B.
Publisher:
Cengage,
Exploring Economics
Exploring Economics
Economics
ISBN:
9781544336329
Author:
Robert L. Sexton
Publisher:
SAGE Publications, Inc
Principles of Economics 2e
Principles of Economics 2e
Economics
ISBN:
9781947172364
Author:
Steven A. Greenlaw; David Shapiro
Publisher:
OpenStax
Microeconomics A Contemporary Intro
Microeconomics A Contemporary Intro
Economics
ISBN:
9781285635101
Author:
MCEACHERN
Publisher:
Cengage
Economics For Today
Economics For Today
Economics
ISBN:
9781337613040
Author:
Tucker
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS