Ambrose's brother Anthony has an income of $75 and a utility function U(x1, x2) = 20x1/21 + x2. The price of good 1 (nuts) is $2 and the price of good 2 (berries) is $1. How many units of nuts will Anthony demand

Ambrose's brother Anthony has an income of $75 and a utility function U(x1, x2) = 20x1/21 + x2. The price of good 1 (nuts) is $2 and the price of good 2 (berries) is $1. How many units of nuts will Anthony demand

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter20: Consumer Choice: Maximizing Utility And Behavioral Economics

Section: Chapter Questions

Problem 4WNG

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PLEASE HELP ME ANSWER IT AS FAST AS YOU CAN Dalal consumes only two goods for lunch and dinner: risotto (R) and lamb machboos (M). Dalal’s utility function isgiven by U(R,M) = R + 4M. Suppose that a risotto dish costs 3 KD and that a dish of lamb machboos costs 6 KD.Dalal has 300 KD a month to spend on her lunch and dinner meals. d. What would Dalal’s optimal basket be given that her utility will equal the level found in part (c)? e. How much would the basket found in part (d) cost? f. How much cash does Jassem need to offer to fulfill his promise?Although both of Jassem’s offers will make Dalal just as happy, their costs will not be the same. g. What is the cheaper option for Jassem: offering a 60 KD risotto gift card or offering the amount of cash foundin part (f) part c solution, available utility is R+4M = 20+200 = 220 utils.
PLEASE HELP ME ANSWER IT AS FAST AS YOU CAN Dalal consumes only two goods for lunch and dinner: risotto (R) and lamb machboos (M). Dalal’s utility function isgiven by U(R,M) = R + 4M. Suppose that a risotto dish costs 3 KD and that a dish of lamb machboos costs 6 KD.Dalal has 300 KD a month to spend on her lunch and dinner meals. a. How many risotto and lamb machboos dishes will Dalal buy each month if she maximizes utility?Dalal’s brother, Jassem, wants to make her happier and is considering two options: giving her a 60 KD gift card that can only be spent on risotto from one of the Italian restaurants or giving her some cash money.If Jassem chooses to give Dalal the 60 KD risotto gift card:b. How many risotto meals can Dalal add to her optimal basket? c. What utility level will Dalal get given her income and the risotto gift card?Suppose that Jassem instead chooses the second option and promises Dalal to raise her income to the level thatensures making her as happy as the first…