Suppose that you want to derive and draw the demand function for Mr. Seong (also known asPlayer 456). Mr. Seong likes to eat Dalgona Candy (D) and drink Soju (S). Suppose Mr. Seong'spreferences can be expressed as U(D,S) = (D)º.² · (S)0.8. Suppose further the price of aDalgona Candy is 2 (pº = 2) and the price of Soju is 4 (ps = 4). Mr. Seong has a budget of 100to spend on the two goods.A. Use the substitution method to find Mr. Seong's optimal choice of Dalgona Candy and Soju.B. Use any method to find Mr. Seong's optimal choice of Dalgona Candy and Soju if the priceof Soju was 5 (instead of 4). Feel free to use the Cobb-Douglas short-cut method if youwant.C. Use your answers to A and B to derive the demand for Soju in the two diagrams below. Thatis, draw the change in the top diagram and then use your result to derive the demand curvein the bottom diagram. Several hints have been drawn in the diagram below.D5010ps54202025SFYI: The Cobb-Douglas short-cut can be expressed as:X = apxYThat is, the demand for good X is a function of thepreference parameter (a), income, and the price of X.SFYI: To draw a demand curve we need tohold all factors that affect demand constant(such as income, preferences, and prices ofrelated goods). Then we change the price ofthe particular good (like Soju) and see howthe quantity demanded (of Soju) changes.Then plot the two (price, quantity)-combinations.There is a relationship between a diagramthat shows the constrained optimizationproblem (top diagram) and the demandcurve (bottom diagram)

Suppose that you want to derive and draw the demand function for Mr. Seong (also known as Player 456). Mr. Seong likes to eat Dalgona Candy (D) and drink Soju (S). Suppose Mr. Seong's preferences can be expressed as U (D, S) = (D)⁰.2. (S)0.8. Suppose further the price of a Dalgona Candy is 2 (p = 2) and the price of Soju is 4 (pS = 4). Mr. Seong has a budget of 100 to spend on the two goods. A. Use the substitution method to find Mr. Seong's optimal choice of Dalgona Candy and Soju. B. Use any method to find Mr. Seong's optimal choice of Dalgona Candy and Soju if the price

Suppose that you want to derive and draw the demand function for Mr. Seong (also known as Player 456). Mr. Seong likes to eat Dalgona Candy (D) and drink Soju (S). Suppose Mr. Seong's preferences can be expressed as U (D, S) = (D)⁰.2. (S)0.8. Suppose further the price of a Dalgona Candy is 2 (p = 2) and the price of Soju is 4 (pS = 4). Mr. Seong has a budget of 100 to spend on the two goods. A. Use the substitution method to find Mr. Seong's optimal choice of Dalgona Candy and Soju. B. Use any method to find Mr. Seong's optimal choice of Dalgona Candy and Soju if the price

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Subpart 4,5,6 only.
Consider a consumer with the utility function U (x1, x2 ) = 10x12/3x21/3 −50. Suppose the prices of x1 and x2 are 10 and 2 respectively and the consumer has an income of 150. How would the optimal bundle change if the utility function was log- linear: 2lnx1 +lnx2?
You go to the store in search of laundry detergent, to discover that they offer two varieties: Myst and Breez. Your preferences between Myst and Breez can be represented by the following utility function: U(M. B) = 16M + 32B Myst costs 4$ unit. Breez costs 10$ per unit for the first 5 units, but all units after 5 only costs $6. Find your Engel Curve for Breez.
(2) Lisa can buy either whole chickens or chicken wings at her local supermarket. Her utility function over whole chickens and chicken wings is U(xc,Xw) = 2xc + Xw, where x, and xw are chickens and chicken wings, respectively. What is her demand function xc (pc, Pw, m) for chickens?
Suppose that an individual has a Utility function represented by a CES function. The utility function of the individual is given as: U(x,y) = x1/2 + y1/2 b. Calculate the own price elasticity using the "share elasticity" of any good. Let us assume that the prices of both goods are equal.
Harry spends his weekly income M > 0 on two commodities, food (X) and rental videos (Y). His utility function is U (X,Y)=2-√x+2·√Y The price of food is Px > 0 and the price of rental videos is Py > 0. Is any of the two goods, food or rental videos, an inferior good for Harry? (
14.3 (0) Quasimodo consumes earplugs and other things. His utility function for earplugs x and money to spend on other goods y is given by u(x, y) = 100x x² +y. 2
Please explain step by step
Suppose that we can represent Joyce's preferences for cans of pop (the x-good) and pizza slices (y-good) with the utility function min[4x,5y]. a) Find her Marshallian Demand Functions. b) Find her Hicksian Demand Functions
4B. Which one(s) of the following functions v(x, y) = 2x°y – 100, w(x, y) = 3(x + y) + 120, t(x, y) = xy - 150 is an ordinal utility function for a preference relation which admits u(x, y) = 3x/2y1/2 + 120 as an utility function? (a) w only (b) v and w (c) v and t (d) v, w and t (e) none of the previous four statements is correct. %3D %3!
Beans and doughnuts: The consumer receives positive benefits from the consumption of beans (B) and donuts (K). Utility function of the consumer is the following: U(B,K) = 100∙B^0.25 · K^0.75 The price of beans (can) is ISK 2,000. but the price of a donut (box) is ISK 4,000. Consumption restrictions are placed on the consumer since his income is ISK 400,000. Put on all form donuts on the x-axis and beans on the y-axis. a) Show an equation for the bean's success rate for a single donut in light of the utility function. Draw the equivalence curve on a picture and explain what the equation is performance ratio is stated at each point on the equivalence curve. Explain with the concept of the efficiency ratio of the curvature of the equivalent curve. b) Find the most efficient consumption combination and draw on the diagram. c) The government decides to support the consumption of beans so its price drops to 1,000. Who is the most economical consumption combination based on the changed price…
Suppose that David and his friend Wilson derive utility from consuming two types of snacks: onion rings (9₁) and chips (9₂). The utility function for each individual is U (9₁, 92) = 9192. Their indifference curves for these two goods are assumed to have the usual (convex) shape. Suppose David has an initial endowment of 35 onion rings and 10 chips, and Wilson's initial endowment consists of 5 onion rings and 20 chips. (1) Draw an Edgeworth box and show the initial allocation of goods, to be labelled e. Indicate the initial quantities of each person's goods on the four axes.