There are two shows on Netflix that Jeff can watch, Show 1 and Show 2. x₁ measures the number of episodes watched of Show 1 and x₂ measures the number of episodes watched of Show 2. Jeff's preferences can be represented by u(x₁, x2) = x² + ax². Jeff has 11 hours available for watching Netflix today. Each episode of Show 1 lasts 30 minutes, while each episode of Show 2 lasts one hour. For all question parts, round to three decimal places if necessary. For parts (a) - (f), let a = 1. Draw Jeff's indifference curves for the utility levels u = 4, 9, 16. Draw a straight line between the bundles (x1, x2) = (4, 0) and (x₁, x₂) = (0,4). Now, use your picture to determine whether the following two statements are true or false. Answer "1" for true. Answer "0" for false. a) Statement 1: Jeff's preferences are strongly monotone. 1 b) Statement 2: Jeff's preferences are strictly convex. 0 c) Find the bundle at which one of Jeff's indifference curves is tangent to the budget line. (x1, x^2) = ( d) Evaluate Jeff's utility at the aforementioned tangent bundle. u(x1, x^₂)= e) Evaluate Jeff's utility at the bundle where he consumes only Show 1. u(22,0) = f) Evaluate Jeff's utility at the bundle where he consumes only Show 2. u(0, 11) =
There are two shows on Netflix that Jeff can watch, Show 1 and Show 2. x₁ measures the number of episodes watched of Show 1 and x₂ measures the number of episodes watched of Show 2. Jeff's preferences can be represented by u(x₁, x2) = x² + ax². Jeff has 11 hours available for watching Netflix today. Each episode of Show 1 lasts 30 minutes, while each episode of Show 2 lasts one hour. For all question parts, round to three decimal places if necessary. For parts (a) - (f), let a = 1. Draw Jeff's indifference curves for the utility levels u = 4, 9, 16. Draw a straight line between the bundles (x1, x2) = (4, 0) and (x₁, x₂) = (0,4). Now, use your picture to determine whether the following two statements are true or false. Answer "1" for true. Answer "0" for false. a) Statement 1: Jeff's preferences are strongly monotone. 1 b) Statement 2: Jeff's preferences are strictly convex. 0 c) Find the bundle at which one of Jeff's indifference curves is tangent to the budget line. (x1, x^2) = ( d) Evaluate Jeff's utility at the aforementioned tangent bundle. u(x1, x^₂)= e) Evaluate Jeff's utility at the bundle where he consumes only Show 1. u(22,0) = f) Evaluate Jeff's utility at the bundle where he consumes only Show 2. u(0, 11) =
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:There are two shows on Netflix that Jeff can watch, Show 1 and Show 2. x₁ measures the number of
episodes watched of Show 1 and x₂ measures the number of episodes watched of Show 2. Jeff's
preferences can be represented by u(x₁, x₂) = x² + ax². Jeff has 11 hours available for watching Netflix
today. Each episode of Show 1 lasts 30 minutes, while each episode of Show 2 lasts one hour. For all
question parts, round to three decimal places if necessary.
For parts (a) - (f), let a = 1. Draw Jeff's indifference curves for the utility levels u = 4, 9, 16. Draw a straight
line between the bundles (x₁, x₂) = (4, 0) and (x₁, x2) = (0, 4). Now, use your picture to determine
whether the following two statements are true or false. Answer "1" for true. Answer "0" for false.
a) Statement 1: Jeff's preferences are strongly monotone.
1
b) Statement 2: Jeff's preferences are strictly convex.
0
c) Find the bundle at which one of Jeff's indifference curves is tangent to the budget line.
(x₁, x^2) = (
d) Evaluate Jeff's utility at the aforementioned tangent bundle.
u(x1, x^2) =
e) Evaluate Jeff's utility at the bundle where he consumes only Show 1.
u(22, 0) =
f) Evaluate Jeff's utility at the bundle where he consumes only Show 2.
u(0, 11) =
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