Suppose Mary has the utility function U(x1, x2) = v(xi) +2x2 with v such that v' > 0and v" < 0. Suppose initially Mary chooses the optimal bundle x = 10 and x2 5.What is the new optimal x if prices for both xj and x2 are cut in half (reduced by50%)?%3DOx1 = 5X1 = 11.7Ox1 = 20O None of the other answers are correctOx1 = 10%3!

Given, Utility Function, U(x1,x2) = v(x1)+ 2X2, v such that v'>0 and V"<0 As mentioned, x1 =…

Suppose Mary has the utility function U(x1, x2) = v(x;) + 2x2 with v such that v' > 0 and v" < 0. Suppose initially Mary chooses the optimal bundle x = 10 and x = 5. What is the new optimal x if prices for both x and x2 are cut in half (reduced by 50%)? Ox1 = 5 Ox1 = 11.7 Ox1 - 20

Suppose Mary has the utility function U(x1, x2) = v(x;) + 2x2 with v such that v' > 0 and v" < 0. Suppose initially Mary chooses the optimal bundle x = 10 and x = 5. What is the new optimal x if prices for both x and x2 are cut in half (reduced by 50%)? Ox1 = 5 Ox1 = 11.7 Ox1 - 20

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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