Question 29 Assume in the market with two consumers, Chloe and Oliver. Chloe's utility function is U(x, y) = 2x + 120y1/2 Oliver's utility function is U(x, y) = 2x+10y. At a Pareto optimal allocation in which both individuals consume some of each good, how much y does Chloe consume? I O 60 05 O 225 O 36

Question 29 Assume in the market with two consumers, Chloe and Oliver. Chloe's utility function is U(x, y) = 2x + 120y1/2 Oliver's utility function is U(x, y) = 2x+10y. At a Pareto optimal allocation in which both individuals consume some of each good, how much y does Chloe consume? I O 60 05 O 225 O 36

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question 3 Gabriel the consumer, has preferences over goods x and y that are perfect substitutes, where utility is u(x,y) = x+y. He has an income of $152. The price of y is $12. If the price of x falls from $8 to $2, then Gabriel's, optimal choice for good x should rise by units. O 51 O53 55 O 57 --
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12 There are two goods and John's preferences can be represented by u: R²0 R given by u(x) = x₁³x2³. His income and price of the two goods are given by (M, P1, 20 P2) = (12, 1, 2). Which 2 of the following 8 options are false: In John's optimal bundle, he consumes the same amount of good 1 as good 2. If we change John's utility function to u(x) = x + then John's optimal bundle remains unchanged. At John's optimal bundle, the slope of the budget constraint equals the slope of the indifference curve. In John's optimal bundle, he spends the same amount on good 1 as good 2. John's preferences satisfy local non-satiation. At John's optimal bundle, his bang per buck of good 1 equals his bang per buck of good If we change John's utility function to u(x) = In (17 +x₁x₂) then John's optimal bundle remains unchanged. If we change the budget set to (M, P1, P2) = (24, 2, 4) then John's optimal bundle remains unchanged.
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7
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