Consider the following utility functions:(1) u(x₁, x₂) = x₁ + 2x2.(2) u(x1, 1₂) = 2125 12.75(3) u(x₁,1₂)=-1²-1₂.(4) u(x1, 1₂) min{x1, 2x2).For utility functions (1) to (3), give the equations of the indifference curves correspond-ing to utility level k, where 22 is expressed as a function of 2₁ and k.For utility functions (1) to (4), draw two indifference curves for each function. Thatis, draw four graphs (one for each utility function) and two indifference curves on eachgraph.

The utility functions given are as follows.

Consider the following utility functions: (1) u(T₁, T₂) = ₁ +2x2. (2) u(x1, 1₂) =21250.75 (3) u(1₁,1₂)=-11-12. (4) u(x1, 2₂) = min{x₁, 2x₂). For utility functions (1) to (3), give the equations of the indifference curves correspond- ing to utility level k, where za is expressed as a function of x, and k. For utility functions (1) to (4), draw two indifference curves for each function. That is, draw four graphs (one for each utility function) and two indifference curves on each graph.

Consider the following utility functions: (1) u(T₁, T₂) = ₁ +2x2. (2) u(x1, 1₂) =21250.75 (3) u(1₁,1₂)=-11-12. (4) u(x1, 2₂) = min{x₁, 2x₂). For utility functions (1) to (3), give the equations of the indifference curves correspond- ing to utility level k, where za is expressed as a function of x, and k. For utility functions (1) to (4), draw two indifference curves for each function. That is, draw four graphs (one for each utility function) and two indifference curves on each graph.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Form Utility

The term utility in general refers to the satisfaction earned from usage of a particular product or service. Utility always plays an important role because it influences various important elements like demand & thereby the price of the good or service as well. Though utility is not easy to measure, various types of economic models can be used indirectly. There can be various types of utilities like economic utility, marginal utility, cardinal utility, form utility.

Question

Consider the following utility functions:
(1) u(x₁, x₂) = x₁ + 2x2.
(2) u(x1, 1₂) = 2125 12.75
(3) u(x₁,1₂)=-1²-1₂.
(4) u(x1, 1₂) min{x1, 2x2).
For utility functions (1) to (3), give the equations of the indifference curves correspond-
ing to utility level k, where 22 is expressed as a function of 2₁ and k.
For utility functions (1) to (4), draw two indifference curves for each function. That
is, draw four graphs (one for each utility function) and two indifference curves on each
graph.

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Step 2: Draw indifference curve for the first utility equation

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Step 3: Draw the indifference curve for the second utility equation

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Step 4: Draw indifference curve for the third equation

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Step 5: Plot utility function for the fourth equation

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Suppose you have a $20 gift card and want to buy Blue and Red yarn. The utility function from yards of blue (B) and red (R) yarn can be expressed as follows: U(B,R) = 3B+R Red yarn costs $4 per yard. blue yarn costs $4 per yard. A) Graph the budget constraint and the indifference curves that can be reached. How many yards of each type of yarn will he purchase at these prices with his gift card?