Indicating consumption sider an agent who want to maximize her duty function, 6₁, 62) - ₁2 subject to budge respectively, while p>0 and w>0 are exogenously given parameters, indicating the relative price of good 2 and the relative wealth in term of good 1's price. Decide whether the following claims are true or false. W The value of the Lagrange multiplier is λ = 2p O False O True The value function u(w) is equal to u(w) = w² 4p O True O False (w) measures the approximate change in utility that can be obtained from an increase/decrease in wealth w. O True O False modity and

Indicating consumption sider an agent who want to maximize her duty function, 6₁, 62) - ₁2 subject to budge respectively, while p>0 and w>0 are exogenously given parameters, indicating the relative price of good 2 and the relative wealth in term of good 1's price. Decide whether the following claims are true or false. W The value of the Lagrange multiplier is λ = 2p O False O True The value function u(w) is equal to u(w) = w² 4p O True O False (w) measures the approximate change in utility that can be obtained from an increase/decrease in wealth w. O True O False modity and

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

Answer it correctly please. I ll rate
Assume x is beer and y is pizza and assume Caspar's utility function were U(x, y) = min{8x, 4x + 16y}. Then, if the price of beer were $20 and the price of pizza were $60, Caspar would demand %3D 3 times as much pizza as beer. O only pizza O 6 times as much beer as pizza 5 times as much pizza as beer. 4 times as much beer as pizza.
P3
A consumer has a utility function over consumption and leisure given by U(c, /) = In(c) + 4 In(/). The consumer is currently working 6 hours per day, is paid $15 per hour and the consumption good costs $5 per unit. Given this information, the consumer could increase their utility by %3D a. They are already at the optimal working hours b. We cannot determine whether they should be working more or less with the information given O c. Working less d. Working more Which of the following explanations for unemployment is inconsistent with the classical theory? a. Firms in a unionized industry cut workers as the union negotiates a higher wage b. A worker refuses to accept a job because they would rather wait for a better opportunity c. Workers choose to work fewer hours as unemployment benefits are generous d. Firms hold off on hiring new workers because they are worried that demand for their products will be low
2. A small college is trying to predict enrolment for the next academic year. Thevice president for business states that enrolment has tended to follow apattern described by E = 18,000 – 0.5P, where E denotes total enrolment andP is yearly tuition.a) If the school sets tuition at €20,000, how many students can it expect to enrol?b) If the school wants to maximize total tuition revenue, what tuition should itcharge?c) As the vice president for business, what tuition would you recommend? Explainbriefly.d) Due to a strong post-COVID-19 recovery, the income conditions in the regionimprove substantially. Explain in one sentence how this could affect the college’senrolment pattern and the enrolment level maximizing its tuition revenue.
Steve's utility function is, U = 10 + 2B0.2 Z0.8 his income is Y, the price of B is pb, and the price of Z is pz. %3D Steve's demand function for good B is Select one alternative: O 0.8 Y Pb O 0.4 Y 00.2% O 0.2Y O 0.2 +10
The consumer choice is not restricted to the choice of consumptiongoods. In fact, it can apply to all our decisions that involve trade-offs. Suppose Mary has awage per hour of 10 euros. With her earned income she consumes. That isC=wH per day.She also decides how many hours to work of take leisure time each day.H=24-N, whereHis work and N is leisure. Her utility is given by （picture） Solve for the optimal decision of labor/leisure. Plot the budget constraint and the indif-ferent curve. What is the labor supply function?
Suppose that consumer has the following utility function: U(X,Y) = x'/3y1/2, Suppose also that Px: 2, Py respectively? %3D 3 and I = 120. What would be the optimal consumption of X and Y at the equilibrium, O 12, 32 48, 8 36, 16 O 24, 24
1. Given the utility function U = (x + 1)y and the constraint xPx + yPy = B a. Find the optimal levels of purchase x* and y*. b. Is the second order condition for maximum is satisfied? c. Calculate the comparative statistics derivatives interpret the results. ax ax ax ay ay ay Əв 'ƏPx' OPу Əв 'Əpx' apy > and 1. Given the utility function U = (x + a)(y + b) and the comstraint xPx +yPy = B a. Find the optimal levels of purchase x* and y*. b. Is the second-order sufficient conditions for maximum satisfied? ax ax ax ay ay ay c. Calculate the comparative statistic derivatives ав'aP['aPy'B'др'дру the results. and interpret
Handwritten solution not required correct answer will get instant upvote.
2
Alex's utility is U (xA, YA) = min {TA, YA}, where zA, and y, are his consumptions of %3D goods a and y respectively. Becky's utility function is U (zB, YB ) = TBYB where ap and yp are her consumptions of goods a and y. Alex's initial endowment is 20 units of x and 12 units of y. Becky's initial endowment is 12 units of x and 20 units of y. At the Walrasian equilibrium, a) Both of them consume 16 units of good y each. b) Alex consumes 8 units of good y and Becky consumes 16 units of y. c) Both of them consumes 12 units of good x each. d) Alex consumes 12 units of good x and Becky consumes 20 units of x. e) None of the above