Suppose Dante only golfs when he has cigars. Specifically, Dante likes to smoke 3 cigars (C) over 2 rounds of golf (G). His preferences are given by the following utility function: U(G, C) = min(3G, 2C) If Dante has a budget of $240 the price of 1 round of golf is PG = $45, and the price of a cigar is Pc = $10, what will be his optimal bundle? ○ (G*, C*) = (6, 9) ○ (G*, C*) = (2, 3) ○ (G*, C*) = (4, 6) 2 ○ (G*, C*) = (², 1)
Suppose Dante only golfs when he has cigars. Specifically, Dante likes to smoke 3 cigars (C) over 2 rounds of golf (G). His preferences are given by the following utility function: U(G, C) = min(3G, 2C) If Dante has a budget of $240 the price of 1 round of golf is PG = $45, and the price of a cigar is Pc = $10, what will be his optimal bundle? ○ (G*, C*) = (6, 9) ○ (G*, C*) = (2, 3) ○ (G*, C*) = (4, 6) 2 ○ (G*, C*) = (², 1)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
![Suppose Dante only golfs when he has cigars. Specifically, Dante likes to smoke 3
cigars (C) over 2 rounds of golf (G). His preferences are given by the following
utility function:
U(G, C) = min (3G, 2C)
If Dante has a budget of $240 the price of 1 round of golf is PG
price of a cigar is Pc $10, what will be his optimal bundle?
○ (G*, C*) = (6,9)
○ (G*, C*) = (2, 3)
(G*, C*) = (4, 6)
○
(G*, C*) = (1, 1)
=
=
$45, and the](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ffd24358e-5277-4b14-8b88-e8d23ef8e39d%2Fcf98f0c7-e982-4961-9084-40ec2f73db2d%2Fu81h71_processed.png&w=3840&q=75)
Transcribed Image Text:Suppose Dante only golfs when he has cigars. Specifically, Dante likes to smoke 3
cigars (C) over 2 rounds of golf (G). His preferences are given by the following
utility function:
U(G, C) = min (3G, 2C)
If Dante has a budget of $240 the price of 1 round of golf is PG
price of a cigar is Pc $10, what will be his optimal bundle?
○ (G*, C*) = (6,9)
○ (G*, C*) = (2, 3)
(G*, C*) = (4, 6)
○
(G*, C*) = (1, 1)
=
=
$45, and the
![Ngan's preferences over Coffee (C) and Redbull (R) are given by
U(C, R) = aC + a²R
Ngan's income is given by M and prices are given by PC and PR. Assuming Ngan is
maximizing her utility, under which condition will she only consume coffee? (i.e.
C*
-
M
Pc
Po
PR
and R* =
PR > PC
Pc = aPR
Pc
PR
> a
ay
0)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ffd24358e-5277-4b14-8b88-e8d23ef8e39d%2Fcf98f0c7-e982-4961-9084-40ec2f73db2d%2Fo81rd2vwc_processed.png&w=3840&q=75)
Transcribed Image Text:Ngan's preferences over Coffee (C) and Redbull (R) are given by
U(C, R) = aC + a²R
Ngan's income is given by M and prices are given by PC and PR. Assuming Ngan is
maximizing her utility, under which condition will she only consume coffee? (i.e.
C*
-
M
Pc
Po
PR
and R* =
PR > PC
Pc = aPR
Pc
PR
> a
ay
0)
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