MRS=-20 along Ray 1 , MRS=-15 along Ray 2  Draw this consumer’s budget constraint, BAB, and indifference curve. Be sure to label your graph completely. Ignore all other indifference curves and bundle

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A: Since you have posted a question with multiple sub parts, we will provide the solution only to the…

Q: A utility maximizing consumer with preferences u(x, y)-x¹/2y1/2 allocates 60 dollars towards the…

A: Utility refers to the level of satisfaction a consumer obtains from the consumption of goods or…

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Q: Explain the consumer’s Preferences and the Indifference Curv

A: Economics: It is the study of the manner of organizing money, business and industry.

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A: Demand: It refers to the things that people consume. The increase in demand makes the increase in…

Q: A consumer has a budget of $72 to consume X and Y, and Px-$2 and Py-$2. Suppose the consumer's…

A: Given information U=X0.5Y0.5 Px=2 Py=2 M=72 Budget constraint M=Px*X+py*Y

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Q: Susan buys bagels and falafels. The price of a falafels is £1 and the price of a bagels is £3. Susan…

A: Price of F=1Price of B=3M=12Budget constraintPF*F+PB*B=<M1*F+3*B=<12

Q: Consider the utility function U(x, y) = xy + x. Which of the following bundles is not on the same…

A: We have to calculate the value of U for all (x,y). The bundle which gives the different result will…

Q: For Daniel, Pepsi and pizza are complementary products. He consumes a Pepsi with two slices of…

A: Complementary goods are products that increase in price when the demand for relative merchandise…

Q: What are indifference curves?

A: The utility is a want satisfying power of a commodity. Marginal utility is the additional utility…

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Q: What would happen to the utility maximising bundle due to income decreasing... (ceteris paribus) ?

A: Utility maximizing:- People and organizations pursue utility maximisation as a strategic strategy…

Q: Given above are some of the indifference curves for a student who consumes Burritos and Pizzas and…

A: The utility function refers to all those commodity bundles that derive the same amount of utility…

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A: The expenditure function provides the minimum cost that a consumer incurs to achieve a certain level…

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Marginal Rate of Technical Substitution

MRTS reaches a manufacturer when a part of the product is lowered to sustain the manufacturing level when the other part is extended. It is the level of the quantity that is lowered when one extra volume is used, and the output is unchanged.

Preferences and Utility Analysis

Before understanding what is preference and utility analysis, it is very important to understand the terms preference and utility separately.