An individuals utility function is given by U = 340x1 + 960x2 + 2x1x2 – 2x – x;/2, - - when the weekly amount of leisure is x1 = 132 and earned income is x2 = 760 answer the
An individuals utility function is given by U = 340x1 + 960x2 + 2x1x2 – 2x – x;/2, - - when the weekly amount of leisure is x1 = 132 and earned income is x2 = 760 answer the
Chapter1: Making Economics Decisions
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![An individuals utility function is given by
U =
340x1 + 960x2 + 2x1x2 – 2x – x3/2,
= 132
when the weekly amount of leisure is x1
and earned income is x2
= 760 answer the
following:
1. The marginal utility of x1 is
2. The marginal utility of x2 is
3. Use the small increments formula to
estimate the change in the utility when x1
decreases by 1 and x2 increases by 4. The
change
4. Does the law of diminishing marginal
utility hold?
5. The MRCS at a given values is
Enter non-integer numerical values as decimals
to at least 3 decimal places. Note: you must
use a. and not , for a decimal point.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fea109d44-32a3-4e47-be89-8a145525e2d6%2F99b86f69-8845-42dc-ad2b-5b2a416d8399%2F1clu10b_processed.jpeg&w=3840&q=75)
Transcribed Image Text:An individuals utility function is given by
U =
340x1 + 960x2 + 2x1x2 – 2x – x3/2,
= 132
when the weekly amount of leisure is x1
and earned income is x2
= 760 answer the
following:
1. The marginal utility of x1 is
2. The marginal utility of x2 is
3. Use the small increments formula to
estimate the change in the utility when x1
decreases by 1 and x2 increases by 4. The
change
4. Does the law of diminishing marginal
utility hold?
5. The MRCS at a given values is
Enter non-integer numerical values as decimals
to at least 3 decimal places. Note: you must
use a. and not , for a decimal point.
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