Tom is vegetarian and always eat a salad (s) with 2 glasses of green juice (g). His utility for the two goods is therefore u(s, g) = min{s, 59}
Tom is vegetarian and always eat a salad (s) with 2 glasses of green juice (g). His utility for the two goods is therefore u(s, g) = min{s, 59}
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
For given prices ps and pg, and level of utility U ̄, Tom’s Hicksian demands for saladand green juices are?
![Tom is vegetarian and always eats a salad (\(s\)) with 2 glasses of green juice (\(g\)). His utility for the two goods is therefore
\[ u(s, g) = \min \left\{ s, \frac{1}{2}g \right\} \]](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F37708386-d0d8-46c3-a2d8-8e337c754037%2F12005b55-36e2-4096-ac05-db84c93be63e%2Fewgft3p_processed.png&w=3840&q=75)
Transcribed Image Text:Tom is vegetarian and always eats a salad (\(s\)) with 2 glasses of green juice (\(g\)). His utility for the two goods is therefore
\[ u(s, g) = \min \left\{ s, \frac{1}{2}g \right\} \]
![Here is the transcription and explanation of the provided equations suitable for an educational website:
The image shows a list of equations labeled (a) to (e) that describe relationships involving \( s^* \), \( g^* \), and several parameters including \( \bar{U} \), \( p_s \), and \( p_g \).
(a)
\[ s^* = \frac{\bar{U}}{p_s}, \quad g^* = \frac{\bar{U}}{\frac{1}{2} p_g} \]
(b)
\[ s^* = \bar{U}, \quad g^* = 2\bar{U} \]
(c)
\[ s^* = \frac{\frac{1}{2} \bar{U}}{p_s + 2p_g}, \quad g^* = \frac{\bar{U}}{\frac{1}{2}p_s + p_g} \]
(d)
\[ s^* = \frac{\bar{U}}{p_s + p_g}, \quad g^* = \frac{\bar{U}}{\frac{1}{2} (p_s + p_g)} \]
(e)
\[ s^* = \frac{1}{2} \bar{U}, \quad g^* = \bar{U} \]
Explanations:
- Each option presents a pair of equations. \( s^* \) and \( g^* \) are expressed as fractions involving the parameter \( \bar{U} \), divided by combinations of \( p_s \) and \( p_g \).
- The variables \( p_s \) and \( p_g \) appear as denominators and reflect their specific roles in each equation set.
- These equations likely represent different scenarios or models in a study, showcasing how the parameters influence results in various conditions.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F37708386-d0d8-46c3-a2d8-8e337c754037%2F12005b55-36e2-4096-ac05-db84c93be63e%2Ff1f6ua_processed.png&w=3840&q=75)
Transcribed Image Text:Here is the transcription and explanation of the provided equations suitable for an educational website:
The image shows a list of equations labeled (a) to (e) that describe relationships involving \( s^* \), \( g^* \), and several parameters including \( \bar{U} \), \( p_s \), and \( p_g \).
(a)
\[ s^* = \frac{\bar{U}}{p_s}, \quad g^* = \frac{\bar{U}}{\frac{1}{2} p_g} \]
(b)
\[ s^* = \bar{U}, \quad g^* = 2\bar{U} \]
(c)
\[ s^* = \frac{\frac{1}{2} \bar{U}}{p_s + 2p_g}, \quad g^* = \frac{\bar{U}}{\frac{1}{2}p_s + p_g} \]
(d)
\[ s^* = \frac{\bar{U}}{p_s + p_g}, \quad g^* = \frac{\bar{U}}{\frac{1}{2} (p_s + p_g)} \]
(e)
\[ s^* = \frac{1}{2} \bar{U}, \quad g^* = \bar{U} \]
Explanations:
- Each option presents a pair of equations. \( s^* \) and \( g^* \) are expressed as fractions involving the parameter \( \bar{U} \), divided by combinations of \( p_s \) and \( p_g \).
- The variables \( p_s \) and \( p_g \) appear as denominators and reflect their specific roles in each equation set.
- These equations likely represent different scenarios or models in a study, showcasing how the parameters influence results in various conditions.
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