consumer has a utility function given by U(x, y) = 3x2 + 2y. The price of x and y are both equal to 1. Which of the following is true?а.To maximize utility, the consumer should consume only xb. The consumer has convex preferencesС.To maximize utility, the consumer should consume only yd. At the consumer's optimal consumption bundle, we should have 3x = 4y

A consumer has a utility function given by U(x, y) = 3x + 2y. The price of x and y are both equal to Which of the following is true? O a. To maximize utility, the consumer should consume only x O b. The consumer has convex preferences O c. To maximize utility, the consumer should consume only y O d. At the consumer's optimal consumption bundle, we should have 3x = 4y

A consumer has a utility function given by U(x, y) = 3x + 2y. The price of x and y are both equal to Which of the following is true? O a. To maximize utility, the consumer should consume only x O b. The consumer has convex preferences O c. To maximize utility, the consumer should consume only y O d. At the consumer's optimal consumption bundle, we should have 3x = 4y

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose that the following Cobb-Douglas utility function is given U(X,Y) = X³y/2, Which of the following is correct? O Law of diminishing Marginal Utility holds for good Y but not for good X while Law of Diminishing Marginal Rate of Substitution holds. Law of diminishing Marginal Utility holds for good X but not for good Y while Law of Diminishing Marginal Rate of Substitution holds. Law of diminishing Marginal Utility holds for good Y but not for good X while Law of Diminishing Marginal Rate of Substitution fails to hold. Law of diminishing Marginal Utility holds for both goods and Law of Diminishing Marginal Rate of Substitution holds as well
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Consider the following graph. Assume that income increases, and the budget constraint line shifts to the right. The utility-maximizing choice on the original budget constraint is A. Enable ZoomPan
Suppose that you have utility function U(x, y) = x2y2, What happens to the share of income spent on each good (, ) when the 1/2 P.X P,y price of x increases? O a. Share spent on x increases O b. Share spent on y increases O c. Both shares stay the same O d. Both shares decrease O e. Not enough information ge Next page
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Anya is currently consuming $1000 worth of consumption goods C and spending 30 hours in leisure I per week, where her marginal rate of substitution is 20. Assume that the price of a consumption good C is $1. This implies that she is willing to: O a. sacrifice 20 hours of leisure to get an extra $1 worth of consumption. O b. sacrifice $20 worth of consumption to enjoy the next hour of leisure. O c. her current utility will be higher by $20 if she gets one more unit of leisure. O d. she values the next unit of consumption at $20.
X2 Phil has preferences over olives (x₁) and ice creams (x₂) with a utility function, u(x₁, x₂)= x₁0.5+ x₂0.5. Suppose his income is $16 and the price of olives is $1 and the price of ice creams is $1, too. Which of the following is TRUE? O The utility level when he spends all of his income on good 1 is 8. O The optimal bundle Phil will choose to consume is (6,10). O The utility level at a bundle (1,16) is 11. None of the above. The optimal bundle Phil will choose to consume is (8,8).
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