Question 5 (30 points) Ellie gets utility from oranges (x1) and orange juice (x2), U(x1, x2). Ellie likes 2 oranges just asmuch as she likes one glass of orange juice. A. (15 points) What type of utility function represents Ellie's preferences (Iam looking for a name here) and provide a utility function that represents Ellie's preferences. B. (15 points) If Ellie hasthe commodity bundle (12.2) what is her level of utility and what is her MRS at (12, 2)? Explain your answer carefully.Question 5 (30 points) Ellie gets utility from oranges (x1) and orange juice (x2), U(x1, x2). Ellielikes 2 oranges just as much as she likes one glass of orange juice.A. (15 points) What type of utility function represents Ellie's preferences (I am looking for a namehere) and provide a utility function that represents Ellie's preferences.B. (15 points) If Ellie has the commodity bundle (12, 2) what is her level of utility and what is herMRS at (12. 2)? Explain your answer carefully.

A. To explain Ellie's preferences in detail, let's first understand the concept of a utility…

Answered: Question 5 (30 points) Ellie gets…

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter21: Demand: Consumer Choic

Section: Chapter Questions

Problem 1E

See similar textbooks

Question

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

4. Liam initially has a weekly allowance of €24 to spend on eggs (at €0.40 per egg) and beans (at €0.80 per tin). Liam will only consume 4 eggs with each tin of beans and never changes this proportion. (a) What is the utility maximising amount of eggs and beans that Liam buys each week? (b) Suppose the price of eggs rise to €0.60 per egg but the price of beans falls to €0.60 per tin. At the same time, Liam's weekly allowance rises to €30. How much of each good will Liam now buy? Compare your answer to that in (a) and explain the difference, if there is one. Use a diagram to complement your answer.
2. Maria likes to have one cup of coffee (x) and two slices of bread (y) each morning. Which of the following utility functions represents Maria's preference for (x, y)? (a) U(x, y) = min(8x, 2y) (b) U(x, y) = min (4x, 2y) - RIGHT ANSWER (c) U(x, y) = min(x, 2y) (d) U(x, y) = min(x, 2y)
The table below represents how Marco feels about chocolate candy bars. a. Fill in the missing values for total utility and marginal utility. Instructions: Enter your answers as a whole number. Chocolate Candy Bars and Marco's Utility Chocolate Candy Total Utility Bars (utils) 0 0 1 27 2 3 4 5 6 (Click to select) 60 ♦ 76 Marginal Utility (utils) 27 19 Suppose Marco currently has two candy bars. You tell Marco you will give him either a soda, which gives him 28 utils of happiness, or two additional candy bars. b. Which is he likely to prefer? 6 1
4 Emily goes camping on the weekend and eats marshmallows (M) and crackers (C) there. She wants to match 1 marshmallow with 2 crackers, but does not eat in different proportion (i.e., perfect com- plement). The price of a marshmallow is 10 cents and the price of a cracker is 5 cents, and she spend up to $3 in total. a) Write down a utility function which represents Emily's preferences over marshmallows and crackers. b) How many marshmallows and crackers is she going to consume? (Hint: the first-order conditions will not help; draw the budget constraint and the indifference curves and look at the highest one that intersect the budget constraint). c) What is the exact value of Emily's indirect utility?
Lee has calculated her marginal utility from buying pizza slices and soda (shown on the table in the worksheet) and wants to use these data to decide how to rationally spend the money she has. The price of pizza is $2.00 and the price of soda is $2.00 question 9 (a) given these prices and your worksheet calculations, what is the first product lee will buy? (b) would lee ever buy four slides of pizza? Why/why not? question 10Given the data in your worksheet, how many pizza slices and sodas lee should buy to maximize her total utility if she rationally spends her budget of 10.00? question 11 when the price of pizza changes, lee's MU/$P changes. If the price of pizza decreases to $1.50 and her budget decreases to $7.50, how many pzza slices and sodas lee should buy to maximize her total utility?
3. Tony is throwing a party at his Fraternity and is trying to choose what booze to buy. A bottle of vodka has three times the alcohol as a six-pack of beer. Assume that Tony only cares about the total amount of alcohol in his basket. (use vodka on the X-axis and beer measured in six-pack on the Y-axis) a) Devise a utility function to represent these preferences. b) Suppose a bottle of vodka costs $40, a six-pack of beer costs $10, and the budget is $200. Write the budget constraint. c) Solve Tony's utility maximization problem and find the optimal combination. d) Suppose that a bottle of vodka cost has increased to $50. What will be his new optimal combination?
39. The following chart shows the total utility that Ammar receives from conşuming various amounts of chocolate candy bars each day: Number candy bars consumed per day Total utility 40 2. 70 3. 90 100 80 Which of the following statements about Ammar's marginal utility is correct? a) His marginal utlty from the first candy bar is greater than his marginal utility from the second candy bar b. His marginal utility from the fourth candy bar is greater than his marginal utility from the third candy bar c. His marginal utility increases at a constant rate d. His greatest marginal utility comes from his consumption of the fourth candy bar
Table 6.4 Chocolate Bars Total Utility 1 10 2 25 3 4 60 5 70 Refer to Table 6.4, which shows a utility schedule for a consumer’s consumption of chocolate bars. The total utility derived from the consumption of one chocolate bar is _____ units. Group of answer choices 70 10 2 45 15
Question 1 Ahmed consumes 7 cookies. The marginal utility of the first cookie is 25 utils; of the second, 20 utils; of the third, 17 utils; of the fourth, 12 utils; of the fifth, 5 utils; of the sixth, 0 utils; and of the seventh, -5 utils. When he consumes these 7 cookies, his total utility from cookies is: 45 utils 0 utils 74 utils 79 utils 84 utils
TABLE 6-3 Chocolate Bars Hot Chocolate Quantity Total Utility Quantity Total Utility 1 15 1 25 30 21 35 40 3 43 4 48 46 48 5 55 Refer to Table 6-3. The table shows Moira's total utility from each chocolate bar and cup of hot chocolate that she consumes. What is the total utility that Moira receives from one chocolate bar and one hot chocolate? 15 20 25 40 4. 3.
ECON Questions 5, 6, 7, and 8 How to solve and answer these economics questions showed in the screenshot?
1. Muhammad enjoys going to the aquarium (x) and playing basketball (y). His preferences on x and y are described by his utility function: U(x, y) = 100x23y3. He has a budget of £120 per week to spend on playing basketball and going to the acquarium. Knowing that p,=10 and py=10: ,2/3,1/3 (A) Find the optimal combination of x and y so that Muhammad maximizes his utility subject to the budget constraint. Show this graphically. (B) Consider now that the price of going to the aquarium increases to £20, the price of playing basketball is now £15 and the income did not change. How does this modify Muhammad's optimal bundle? Show this graphically. (C) Compare the optima in (A) and (B): has the valuation of y in terms of x changed? Explain.

SEE MORE QUESTIONS

Recommended textbooks for you

Economics:

Economics

ISBN:

9781285859460

Author:

BOYES, William

Publisher:

Cengage Learning

Microeconomics A Contemporary Intro

Economics

ISBN:

9781285635101

Author:

MCEACHERN

Publisher:

Cengage

Exploring Economics

Economics

ISBN:

9781544336329

Author:

Robert L. Sexton

Publisher:

SAGE Publications, Inc

Economics:

Economics

ISBN:

9781285859460

Author:

BOYES, William

Publisher:

Cengage Learning

Microeconomics A Contemporary Intro

Economics

ISBN:

9781285635101

Author:

MCEACHERN

Publisher:

Cengage

Exploring Economics

Economics

ISBN:

9781544336329

Author:

Robert L. Sexton

Publisher:

SAGE Publications, Inc

Microeconomics: Private and Public Choice (MindTa…

Economics

ISBN:

9781305506893

Author:

James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:

Cengage Learning

Economics: Private and Public Choice (MindTap Cou…

Economics

ISBN:

9781305506725

Author:

James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:

Cengage Learning

Economics (MindTap Course List)

Economics

ISBN:

9781337617383

Author:

Roger A. Arnold

Publisher:

Cengage Learning

SEE MORE TEXTBOOKS