Consider the problem of a consumer who must choose between two types of goods, good 1 (x₁) and good 2 (x2) costing respectively p₁ and p2 per unit. He is endowed with an income m and has a utility function u defined by u(x₁, x₂) = √√√√x₁ + x₂. 1. Show that the consumer's utility function is quasi-concave. 2. Write down the maximization problem of the consumer.

Q: For each of the following utility functions, compute the marginal utility of good X (MUx) and the…

A: Marginal utility: marginal utility refers to the addition to the total utility when an additional…

Q: You are choosing between two goods, X and Y, and your marginal utility from each is as shown in the…

A: Units of X MUX Units of Y MUY MUX/Price of X MUY/Price of Y Total utility of X Total utility of Y…

Q: Suppose Pacó has an annual entertainment budget of I. He spends his entertainment budget on only 2…

A: Utility Function is given as U(v,m) = 4v1/2m. Price of Video games: Pv Price of Movies: Pm

Q: Consider a consumer who consumes pizzas and soft drinks. The utility function is given by U (p, s) =…

A: The satisfaction a customer experiences from consuming a combination of services and items is…

Q: Penny likes to have peanut butter (B) with apples (A). The price of apples is $3 per pound and…

A: Utility is maximized when marginal rate of substitution is equal to price ratio of two goods at the…

Q: Rick consumes 2 goods, Chicken McNuggets (M) with Szechuan sauce (S). His utility function is U(M,…

A: Given U(M,S)=M^{2/3}S^{1/3} a.) Budget constraint : Let M denote Mcnuggets and S Szechuan sauce,…

Q: Consider a consumer who has a direct utility function given as U(x₁, x2) = (x1+x25)² where ₁ > 0 and…

A: Utility Function: A utility function is the combination of all commodity bundles that gives a…

Q: Rick consumes 2 goods, Chicken McNuggets (M) with Szechuan sauce (S). His utility function is U(M,…

A: The consumer is in equilibrium when indifference curve is tangent to the budget line. It is…

Q: A consumer consumes two agricultural products: Red Meat, and Tomatoes according to the following…

A: Let y  be the income of the consumer and let pR , pT be the prices of R and T. Then, given pR , pT ,…

Q: Assume that a person's utility function is given by the following function: TU = 2X/2y/2 Assume also…

A: utility function is an important concept that measures preferences over a set of goods and services.…

Q: Biwei’s utility function U=4XY, where X is consumption of beer and Y is consumption of pizza. For…

A: The utility function measures the welfare or satisfaction of a consumer as a function of the…

Q: Suppose that a consumer with the utility function U = X0.75 Y 0.25 choses a bundle where X=10 and…

A: According to the given question, the utility function is given as U=X0.75Y0.25 With the bundle…

Q: I. You only consume two goods and your preferences are represented by utility function U(x1, x₂) =…

A: Monotonic preference refers to a preference ordering in which an individual's preference for one…

Q: Suppose that a consumer with the utility function U = X0.75 Y0.25 choses a bundle where X=10 and…

A: Marginal utility per dollar is the ratio of marginal utility to the price of the good. It increases…

Q: Is updating products to be better and different is considered an innovative product and thus…

A: Every firms have objective to make their profit Maximized and increase the market base . For that…

Q: Suppose that a consumer with the utility function U = X^.75 Y^.25 choses a bundle where X=10 and…

A: Utility function: The utility function is a key concept in economics that assesses preferences…

Q: PLEASE HELP ME ANSWER IT AS FAST AS YOU CAN   Dalal consumes only two goods for lunch and dinner:…

A: Note: Since the question contains more than three subparts, we are going to answer first three…

Q: Given, the utility function is a Cobb-Douglas utility, u = x₁x), and budget m = pix1 + P2X2. a)…

A: The utility function represents the relationship between the utility and commodities consumed. Here,…

Q: Imran consumes two goods, X1 and X2. his utility function takes the form: u(X1, X2)=…

A: Utility function is given as: U(X1,X2) = 4X13+3X25Px1=2Px2=4

Q: Dalal consumes only two goods for lunch and dinner: risotto (R) and lamb machboos (M). Dalal’s…

A: ***Since the student has posted a question with multiple subparts, hence, the expert is required to…

Q: Suppose a consumer’s utility function is u = x_1^(3/2) x_2^(3/2) . She spends her budget of £27 for…

A: Income = 27  Price of x1 : p1 = 6 Price of x2 : p2 = 6  Budget Constraint without discounts : P1x1 +…

Q: Rick consumes 2 goods, Chicken McNuggets (M) with Szechuan sauce (S). His utility function is U(M,…

A: U(M,S)=M2/3S1/3M=PM+PSMUM=dUdM=M2/3S1/3M=23M-1/3S1/3MUS=dUdS=M2/3S1/3S=13M2/3S-2/3MUMPM=MUSPS23M-1/3…

Q: 1.3. Consider the following utility function for a consumer who consumes two goods, x1 and x2, and…

A: U(x1,x2) = ln(x1) + x2 where x1 = good 1 and x2 = good 2

Q: Rick consumes 2 goods, Chicken McNuggets (M) with Szechuan sauce (S). His utility function is U(M,…

A: A consumer maximizes utility where the marginal rate of substitution equals the price ratio of the…

Q: Rick consumes 2 goods, Chicken McNuggets (M) with Szechuan sauce (S). His utility function is U(M,…

A: The Budget Constraint Equation is a formula that calculates the amount of money that can be It means…

Q: 2. Vibha consumes three goods X, (shirts), X, (food in pounds), and X, (shelter in square feet).…

A: Rational consumer always consumes bundle of goods which provides him maximum utility. when law of…

Q: M = $160 budgeted to be spend on these two goods and the prices of Apples and Ice Cream are p1 =$2,…

A: 1st & 2nd blank For optimum => 3x1 = x2 ---------------1 And, Budget line => 2x1+x2 = 160…

Q: 1 Consider a consumer who consumes only two goods, z1 and z2. His utility function is u (1, 2) = In…

A: Utility function is given as:- U(z1,z2) = lnz1+z2 Price of z1 = $2 Price of z2 = $4 Income = 100

Q: the MRS = -N/W.   The budget constraint is: 1,600 = 2*N + 20*W   Graph Qty of noodles (N) on…

A: Utility function given above is convex to the origin because as we move down the the IC the MRS…

Q: Devon's utility function can be written as ?1^0.50?2^0.50, where ?1 is the quantity of hamburgers…

A: Given: utility function is u(x1,x2)=x10.5x20.5 Price of hamburgers = P1= $8.00 Price of milk shake =…

Q: You consume music (M) and concert tickets (C). Your utility function is U(M, C) = M1/4C3/4. The…

A: Given  Utility function: U(M,C)=M1/4C3/4                                     .....(1) Marginal…

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.