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- At the current combination of X and Y the consumer's MU-7 and MU, 4. If Px=3 and Py=2, is the consumer maximizing their satisfaction? If not, explain in detail what the consumer should do, and illustrate.give me a solution within 30-40 mins I'll give you multiple upvotes.2) A consumer of two goods, either 1 or 2, has a utility function U (X1, X2) = x1 0,6.x2 0.4, where x denotes units of good 1 and x2 units of good 2. The price of good 1 is 5 euros per unit, the price of good 2 is 3 euros per unit and the consumer's income is 150 euros. Suppose only the price of good 1 changes and so does the new one price is p1‘ = 2. Then the Slutsky substitution effect with respect to good 1 is Choose one: A) Not defined B) 10.8 C) 8.8 D) 7.8 E) 9.8
- URGENT PLEASE IN ONE HOUR1) Elaine wants to keep a good balance of soup and Jujyfruit (a delicious fruit flavored candy) in her diet. Her preferences over bundles of soup and Jujyfruit are represented by the quasi-linear utility function U(S,J) = J0.5 + S, where S and J denote the quantities of soup and Jujyfruit, respectively (Assume fractional quantities of each good can be consumed). Let Ps & Pj denote the prices of the goods and Y denote Elaine's monthly income for spending on these goods. For this exercise, treat soup as the x-axis good. a) Find Elaine's Marshallian demand for soup and Jujyfruit. Is soup a normal or an inferior good? Justify your answer using calculus. Also, calculate the derivative of Marshallian demand for Jujyfruit with respect to income and briefly explain what this implies about the relationship between the demand for Jujyfruit and income for Elaine. b) Now, assume Pj = $5 and Ps Marshallian demanded quantities of Jujyfruit and soup given these prices and income. Use your answers…25 Columns 1 through 4 in the following table show the marginal utility, measured in utils, that Ricardo would get by purchasing various amounts of products A, B, C, and D. Column 5 shows the marginal utility Ricardo gets from saving. Assume that the prices of A, B, C, and D are, respectively, $9, $3, $2, and $6 and that Ricardo has an income of $71. Column 1 Column 2 Column 3 Column 4 Column 5 Units of Good A Units of Units of Units of MU MU MU MU Good B Good C Good D Number of Dollars Saved MU 1 72 1 24 1 15 1 36 1 5 2 54 2 15 2 12 2 30 2 4 3 45 3 12 3 8 3 24 3 3 4 36 4 9 4 7 4 18 4 2 5 27 5 7 5 5 5 13 5 1 6 18 6 5 6 4 6 7 6 0.50 7 15 7 2 7 3.5 7 4 7 0.25 8 12 8 1 8 3 8 2 8 0.13 Instructions: Enter your answers as a whole number. a. What quantities of A, B, C, and D will Ricardo purchase in maximizing his utility? 4 units of A 3 units of B units of C units of D b. How many dollars will Ricardo choose to save?
- The demand for Good A is Qd = 1000 - 0.5P + 0.011. If, on average, an income increase of 3% increases quantity demanded by 1%, all else constant. Using Qd = 500, how do you write the demand equation?With this graph given, What are the implications of this to both the sellers and the consumers?5) A consumer of two goods, good 1 and good 2, has a utility function u (X1, X2) = x1 0,6. X2 0,4, where x denotes units of good 1 and X2 units of good 2. The price of good 1 is 5 euros And the price of good 2 is 3 euros per unit and the consumer’s income is 150 euros. Suppose that only the price of good 1 changes and that the new price is p, ‘ = 2. Then the demand function of good 1 that is derived from the utility function is Choose one: A) X1= 0.6m/p1 B) X1= 6m/p1 C) X1= 4m/p1 D) X1= 0.4m/p1 E) Not defined
- Q 2Do the equations state that good A is a normal good? Yes or no. Defend your answer.1. Let Amy derive utility each from housing, h, and a consumer good, z, with the following utility function: 1/ U=h¾/3₂¾3 M Her Mashallian demand equations are the following: h= and z=- 3ph 2M 3p₂ Amy lives in a city where everyone works downtown. While her income is $160 per month, her commute cost (bus pass) costs her $40 per month, so she only has $120 to spend on h and z. (we assume no time cost of the commute) The consumer good, z, has a price of $1 and the price of her housing, h, is $2 per unit. a. What is her quantity demanded of h and z and what level of utility is she currently enjoying? She is considering moving to a location further from work to a house where her commuting cost would be $60 per month (so she will have $100 to spend on z and h). The market adjusts ph and housing sizes across the city so that utility is the same at every location around the city. b. What is the equation for the appropriate demand function for housing in this city? C. What the price of housing…