n individual’s utility function is given by U = 900x1 + 500x2 + 6x1x2 − x21 − x2/2. When the weekly amount of leisure is x1 = 140 and earned income is x2 = 800 answer the following: (a)  What is the marginal utility of x1 ? (b)  What is the marginal utility of x2 ? (c)  Use the small increments formula to estimate the change in the utility when x1 decreases by 1 and x2 increases by 4. (d)  Does the law of diminishing marginal utility hold? (e)  What is the MRCS at a given values?

Q: Problem 1 Jane has the following utility function: u(w) w^.5 or the square root. function Which of…

A: Among the 3 payoff structures, that particular payoff structure would be chosen which would provide…

Q: How did you arrive at -0.15 here? MB = (1/3)(90 - 0.6(9,588 + g)½- 0.3g½) To find Susan's optimal…

A: Marginal benefit (MB) refers to the additional benefit or utility that an individual receives from…

Q: 8/ A consumer has the following utility function: u (x, y) = 6xy + 10 a) Determine the marginal…

A: NOTE: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…

Q: The goal of the consumer is to maximize the total utility or satisfaction derived from their…

A: The total value or benefits being derived by an individual from the consumption of units of goods or…

Q: Utility is given as: U(x, y) = x^1/2y^1/2   (a) Graph a typical indifference curve for this…

A: An economic concept that refers to satisfaction in consuming the commodity. By deducting the…

Q: Assume that someone has inherited 2,000 bottles of wine from a rich uncle. He or she intends to…

A: Given,  Someone inherited 2,000 bottles. She intends to drink these over the next 40 years. Utility…

Q: Consider a utility function given by u(x, y) = (ax² + by). It is called CES utility function.

A: Given utility function   u(x,y)=axρ+byρ1ρGiven utility function is known as CES production…

Q: Tom's indirect utility function is (a) V = I Ps+2pg (b) V = (c) V (d) V = = (e) V = I Ps+Pg I…

A: Tom's utility function: This utility function shows that the salad (s) and green juice (g) are…

Q: For the utility function U = (Qx0.5+Qy0.5)2 and the budget 190 = 5Qx + 12Qy find the CHANGE in…

A: The utility function is given as The budget constraint is given as The price of X is increased by a…

Q: An individual has a utility function, U(q,,42) = Jq1•92). (Mathematical assistance: x = x2). Derive…

A:

Q: (1)A utility maximizing consumer purchases two commodities. The utility function is U= Q1 Q2 + 3Q1 +…

A:

Q: QUI If the budget equation is the following 19594 x₁ + 8525 x2 = 10269. What is the maximum amount…

A: To find the maximum amount of x1that a consumer can buy given the budget constraint equation

Q: For the same set of preferences as in question 5 of this problem set, what is the elasticity of…

A: We have given utility function  U = AxAαxB1-α To find price elasticity of demand of good XA, we need…

Q: The horizontal intercept of the consumer's budget line is equal to a) T -T O b) wh +T -T c+ w(h-1) O…

A: A consumer's budget line is a locus of different combinations of two goods that a consumer can…

Q: Consider the problem of an individual that has Y dollars to spend on consuming over o periods. Let c…

A: In period 1 : Consumption = c1  Income = Y  Budget Constraint : P1c1 + s = Y  Y - P1c1 = s Income in…

Q: Consider the utility function U(x, y) = x^4 + y^2 (a) What happens to the marginal utility of x as y…

A: U(x,y) = x4 + y2.

Q: Consider a consumer with quasilinear utility u(x) = 10ln(x₁) + X₂. (a) Find the Marshallian Demand…

A: Although you have asked for the explanation of subpart d only, it requires the solution of all three…

Q: V*(p1, p2, 1) = O True O False P₁ P2 1² is a valid indirect utility function.

A: The indirect utility function describes the maximum utility that a consumer can obtain from a given…

Q: A consumer is maximising her utility function: U(x, y) = (x¹/³+y¹/³)³, subject to the budget…

A: A consumer maximizes his/her utility given his/her income at that point where the slope of the…

Q: find the utility-maximizing consumption function subject to the budget constraint

A: For the utility maximising consumption bundle the basic principle is that we equate the rate at…

Q: A consumer has preferences over bundles of two goods with indifference curves defined by -¤2 = ½ for…

A: In the study of economics, the term utility can be defined as the total satisfaction or benefit that…

Q: Consider a consumer with preferences over two goods, r₁ and 22, that can be represented by the…

A: Optimal consumption bundle is when MUx1 / MUx2 = Px1 / Px2Where, MUx1 = Marginal utility from good…

Q: Hella the Greek's preferences can be described by the utility function U(x, y) = (x^1/2 + 3^1//2)^2.…

A: Hella the Greek's PreferencesLet's analyze Hella's preferences based on her utility function:(a)…

Q: Budi and Ahmad are stranded on a remote island. Each had a few cans of bacon (D) and a few packs of…

A: The term "market equilibrium" refers to a condition in which the supply and demand of a market are…

Q: Sales are a function of advertising in newspapers and magazines (X, Y).…

A: Sales which is a function of advertising in newspapers and magazines (X, Y) is given as- S = XY2…

Q: Suppose a consumer's income elasticities are constant and equal across all goods. (5) (a) What is…

A: 5)  Income elasticity of demand is the responsiveness of the quantity demanded to the change in…