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- Consumer's Utility: U=2Y2-16Y What is the utility maximizing level of income?3. U(X,Y)= X¹/2Y1/2 M = $36: Py = $1; Px is initially = $1; the price of Good X increases to Px = $9. 4. U(X,Y)= X1/2Y1/2 M = $64; Py = $1; Px is initially = $16; the price of Good X decreases to Px = $1.Please help with 10.1 10.2 and 10.3
- Kamau's utility function for watching football (F) and drinking a soda (S) is given by the function (F,S)=F°S . Last month, the price of a football ticket was Ksh.100 and the price of Soda was Ksh.25. This month the price of soda has risen to Ksh.37.5, the price of a football ticet has remained the same. For both months, Kamau's income has remained to be Ksh750. Calculate Kamau's CS, CV and EV.Suppose an individual has a single period utility function represented by: U = Z²H² Suppose further that the individual is deciding how to spend an hour of their time. Below, you are given information about the meal options and how each meal contributes to the "Home" ("Z") portion of utility and the "Health" ("H") portion. Meal Health (H) contribution to Utility Puzzle Jogging Watching netflix +10 Home Good (Z) contribution to Utility Jogging Watching netflix Doing a puzzle If the individual is in a one-period model, meaning they only care about maximizing utility today, what will they choose? +1 +3 +3 +5 +3Calculate the individual’s equivalent variation.
- Eren’s two main hobbies are taking vacations overseas (V) and eating expensivemeals (M). His utility function is given as: U(V,M) = V2MLast year, the average price of taking a vacation overseas was US$200 and the averageprice of an expensive meal is $50. However, due to supply problems in Onions, theaverage price of an expensive meal rose to $75. The average price of a vacation did notchange. His income, which is $1500, did not change. Calculate for the equivalent variation (EV) for the price change.Eren’s two main hobbies are taking vacations overseas (V) and eating expensivemeals (M). His utility function is given as: U(V,M) = V2MLast year, the average price of taking a vacation overseas was US$200 and the averageprice of an expensive meal is $50. However, due to supply problems in Onions, theaverage price of an expensive meal rose to $75. The average price of a vacation did notchange. His income, which is $1500, did not change. Suppose that the Department of Welfare wants to know how much should begiven to Eren to offset his change un utility due to the price increase of an expensivemeal. Calculate the compensative variation (CV).Eren’s two main hobbies are taking vacations overseas (V) and eating expensivemeals (M). His utility function is given as: U(V,M) = V2MLast year, the average price of taking a vacation overseas was US$200 and the averageprice of an expensive meal is $50. However, due to supply problems in Onions, theaverage price of an expensive meal rose to $75. The average price of a vacation did notchange. His income, which is $1500, did not change. Calculate the change in consumer surplus from consuming the expensivemeals considering the price change (Hint: you need to compare his optimalconsumption bundle before and after the price change to get the change in CS).
- 11. Let u(x₁, x₂) = x₁02x₂0.8. Suppose the consumer initially has income level m = 20 and the prices are p₁ = 4 and p2 = 1. Calculate the income and substitution effect when the price of Good 1 decreases to p₁ = 2. Based on your calculation, was the substitution or income effect larger for Good 2?Please answer fastThe blue budget line is for an income of $1000, Px=$5 and Py=$10. At point A, the person is evenly dividing his income between purchases of good X and Y. At point B, the person is buying 20 units of Good X. At point C, the person is buying 0 units of good Y and how many units of Good X. Good X E F Good Y
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