Daniele has an income of 100 and he has to spend it to buy pencils and pens. To him, the two goods are perfect substitutes, i.e. u(x₁,x2)= X₁ + X2. If pens are twice as expensive asthe pencils, what would be his optimal bundle?O Buy only PensO Any combination maximises his utilityO Buy only PencilsO Buy same amount of pens and pencilsO Buy twice as many pencils as pensO No answer.

Utility refers to the happiness or satisfaction that an individual get from the consumption of a…

Daniele has an income of 100 and he has to spend it to buy pencils and pens. To him, the two goods are perfect substitutes, i.e. u(x₁,x2)= X1+ X2. If pens are twice as expensiv the pencils, what would be his optimal bundle? O Buy only Pens O Any combination maximises his utility O Buy only Pencils O Buy same amount of pens and pencils O Buy twice as many pencils as pens O No answer.

Daniele has an income of 100 and he has to spend it to buy pencils and pens. To him, the two goods are perfect substitutes, i.e. u(x₁,x2)= X1+ X2. If pens are twice as expensiv the pencils, what would be his optimal bundle? O Buy only Pens O Any combination maximises his utility O Buy only Pencils O Buy same amount of pens and pencils O Buy twice as many pencils as pens O No answer.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

A consumer’s preferences over two goods x and y are given bythe utility function U(x, y) = x^αy^β with α, β > 0. The prices of the goods are px = 2 and py = 4.The consumer has an income of I > 0.• For what values of α and β are these utility functions strictly monotone?• For what values of α and β will the consumer demand (i.e., Walrasian demand) be more x than y?• For what values of α and β are these goods gross substitutes? For what values of α and β are these goods gross complements? Provide a justification for your answer.
I need the answer as soon as possible
Question 21 A consumer chooses an optimal consumption point where the O marginal rate of substitution is maximized O slope of the indifference curve exceeds the slope of the budget constraint by the greatest amount O ratio of the marginal utilities equals the ratio of the prices O All of the above are correct
Based on his preferences, Bill is willing to trade 3 movie tickets for 1 ticket to a basketball game. If movie tickets cost $6 each and a ticket to the basketball game costs $16, should Bill trade movie tickets for basketball tickets? Why or why not? Bill should O A. trade movie tickets for basketball tickets because his marginal utility per dollar spent on movie tickets is less than his marginal utility per dollar spent on basketball tickets. O B. trade movie tickets for basketball tickets because his marginal utility per dollar spent on movie tickets is greater than his marginal utility per dollar spent on basketball tickets. O C. trade movie tickets for basketball tickets because his marginal rate of substitution equals the ratio of the price of a basketball ticket to the price of a movie ticket. O D. not trade movie tickets for basketball tickets because his marginal rate of substitution is less than the ratio of the price of a basketball ticket to the price of a movie ticket. O E.…
Time left Thomas has utility U = min{3C, T) over cookies and tea. Suppose the price of cookies declines by 1 dollar. How much of the change in demand for tea is a substitution effect? In other words, what is (change h7/change gr)? O a. 0 O b. 1/4 O c. 1/3 O d. 2/3 O e. 3/4 O f. 1 Clear my choice Which of the following utility functions does not represent the same preferences as U(x, y) = x2y/2? O a. U(x, y) = xy O b. U(x, y) = In(x) + In(y) O c. U(x, y) = In(x y) O d. U(x, y) = x2 + yl/2 Clear my choice (we haven" this and yo not expect BOANIT 8
Soppose Felix has 9dollars to spend on good x and y.The price ofgood Y is one.If consuming 6units of good y is utilitymaximizing,what must be the price of good x and the amount of goodx that he consumes for a utility function ofa.U=x^(1/3)y^(2/3)b.U=x+2yc.U=x+ln y
lucys utility functions is U (s, l) = min{s2+2L2, 2s2+L2}, where s is her consumption of sandwiches and l is her consumptionof cups of lemonade.a. Draw Susan’s indifference curve along which her utility is 300b. How many sandwiches and cups of lemonade Susan will consume if shehas $20 and price of a sandwich and a cup of lemonade are $2 and $4,respectively.
Which of the following is true about utility? O Utility same for all the consumers O Utlity is subjective Utility for a good is constant O Utlity is same as usefulness
Solve this pls
12 Manuel is a consuming his optimal bundle, and is currently willing to give up 5 apples to obtain 1 orange. Jorge is in the same economy and consuming his optimal bundle, but his marginal utility of oranges is twice that of Manuel. How many apples is Jorge willing to give up to obtain 1 orange? Explain Briefly
X2 Phil has preferences over olives (x₁) and ice creams (x₂) with a utility function, u(x₁, x₂)= x₁0.5+ x₂0.5. Suppose his income is $16 and the price of olives is $1 and the price of ice creams is $1, too. Which of the following is TRUE? O The utility level when he spends all of his income on good 1 is 8. O The optimal bundle Phil will choose to consume is (6,10). O The utility level at a bundle (1,16) is 11. None of the above. The optimal bundle Phil will choose to consume is (8,8).