Paige has the utility function U(x, y) In(x) + 4y Do not worry about corner solutions when answering the following questions, you can use the Lagrangian multiplier method. Paige's budget constraint is px + Pyy: I
Paige has the utility function U(x, y) In(x) + 4y Do not worry about corner solutions when answering the following questions, you can use the Lagrangian multiplier method. Paige's budget constraint is px + Pyy: I
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
![Paige has the utility function U(x, y) = ln(x) + 4y
Do not worry about corner solutions when answering the following questions, you can use the
Lagrangian multiplier method. Paige's budget constraint is px x +Pyy = I](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb9c59a52-435e-40d4-a4cc-d95ba9c85ded%2F15a136f0-2c5a-4d2c-8776-0e32afc1391a%2Fgoxfyl_processed.png&w=3840&q=75)
Transcribed Image Text:Paige has the utility function U(x, y) = ln(x) + 4y
Do not worry about corner solutions when answering the following questions, you can use the
Lagrangian multiplier method. Paige's budget constraint is px x +Pyy = I
![What is the indirect utility function?
Py
○ V (Pa, Py, 1) = ln (PP)
¹ (20) + 2 ( 1/1 − 2)
Py
○ V (Px, Py, I) = ln(x) + 4y
○ V (P, Py, 1) =
I)
Py
I
n(P) + 4 ( ½ - 4 )
Py
○ V (Px, Py, I = ln
: In ( ) + 4 (P)
Py
○ V (Pæ, Py, I = ln ( 2 − 4) + 2 (10₂)
In
Py
4px](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb9c59a52-435e-40d4-a4cc-d95ba9c85ded%2F15a136f0-2c5a-4d2c-8776-0e32afc1391a%2Ff20bdna_processed.png&w=3840&q=75)
Transcribed Image Text:What is the indirect utility function?
Py
○ V (Pa, Py, 1) = ln (PP)
¹ (20) + 2 ( 1/1 − 2)
Py
○ V (Px, Py, I) = ln(x) + 4y
○ V (P, Py, 1) =
I)
Py
I
n(P) + 4 ( ½ - 4 )
Py
○ V (Px, Py, I = ln
: In ( ) + 4 (P)
Py
○ V (Pæ, Py, I = ln ( 2 − 4) + 2 (10₂)
In
Py
4px
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