Please refer to the following information to answer the question (in bold) below: You enjoy consuming apples (A) and oranges (O). Suppose that your utility function over both goods is given by Your marginal utility function for apples is Your marginal utility function for oranges is U (A, 0) = A0³ 2 apples, 28 oranges MUA 3 apples, 26 oranges 4 apples, 24 oranges 5 apples, 22 oranges 8 apples, 16 oranges 9 apples, 14 oranges = MUO = 3A0² . Currently, the price of apples is $10/peck, the price of oranges is $5/pound, and your income is $160. Assume that apples are your horizontal axis good and oranges are your vertical axis good. 0³ Given your preferences and budget constraint, what bundle represents your consumer equilibrium for apples and oranges?

Please refer to the following information to answer the question (in bold) below: You enjoy consuming apples (A) and oranges (O). Suppose that your utility function over both goods is given by Your marginal utility function for apples is Your marginal utility function for oranges is U (A, 0) = A0³ 2 apples, 28 oranges MUA 3 apples, 26 oranges 4 apples, 24 oranges 5 apples, 22 oranges 8 apples, 16 oranges 9 apples, 14 oranges = MUO = 3A0² . Currently, the price of apples is $10/peck, the price of oranges is $5/pound, and your income is $160. Assume that apples are your horizontal axis good and oranges are your vertical axis good. 0³ Given your preferences and budget constraint, what bundle represents your consumer equilibrium for apples and oranges?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Please refer to the following information to answer the question (in bold) below: You enjoy consuming apples (A) and oranges (O). Suppose that your utility function over both goods is given by . Your marginal utility function for apples is Your marginal utility function for oranges is O You utility increases due to the price change U (A, 0) = AO³ You utility decreases due to the price change MUA = 0³ . Currently, the price of apples is $10/peck, the price of oranges is $5/pound, and your income is $160. Assume that apples are your horizontal axis good and oranges are your vertical axis good. Let's say the price of oranges rises to $10/pound of oranges. Comparing the utility you receive from your old consumer equilibrium bundle to your new consumer equilibrium bundle, how does the increase in the price of oranges impact your level of satisfaction as a consumer? MUO = 340² ЗАО2 You utility is unaffected by the price change You utility could either rise or fall due to the price change