U = 340x1 +960x2 + 2x1x2 – 2x – /2, when the weekly amount of leisure is x1 = 132 and earned income is 2 = 760 answer the following: 1. The marginal utility of x1 is 2. The marginal utility of x2 is 3. Use the small increments formula to estimate the change in the utility when r1 decreases by 1 and x2 increases by 4. The change 4. Does the law of diminishing marginal utility hold? 5. The MRCS at a given values is Enter non-integer numerical values as decimals to at least 3 decimal places. Note: you must use a. and

U = 340x1 +960x2 + 2x1x2 – 2x – /2, when the weekly amount of leisure is x1 = 132 and earned income is 2 = 760 answer the following: 1. The marginal utility of x1 is 2. The marginal utility of x2 is 3. Use the small increments formula to estimate the change in the utility when r1 decreases by 1 and x2 increases by 4. The change 4. Does the law of diminishing marginal utility hold? 5. The MRCS at a given values is Enter non-integer numerical values as decimals to at least 3 decimal places. Note: you must use a. and

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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(a) Suppose we have preferences U(X, Y) = 10X²/³ Y¹/3, Create a table and graph/sketch the indifference curve through the bundle X = 30 and Y = 30.< (b) The Marginal Rate of Substitution is MRSxy=-2Y/X. For the bundle (X= 30, Y = 30), calculate and then interpret what the value of the MRS means.< (c) Cobb-Douglas preferences are strictly convex. What does this imply about the MRS as we move along the indifference curve? Explain/discuss (you may want to draw a picture). < (d) What are the two conditions (equations) that identify the optimum given these preferences and the consumer's budget constraint? Sketch this in a figure and explain.< (e)_From (d) we can show that optimal demands are: X=½ M/PX and Y = ½ M/Px. (you do not have to derive these, just use the equations I have given you.) Calculate optimal demands (X*, Y*) and utility if Px = 10, Px= 5 and income M = 1200. < (f)_Suppose Px falls to Px = 8 but Py and M are unchanged (Px = 5 and M = 1200). Calculate the new optimal demands…
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Suppose an individual has a single period utility function represented by: U = Z²H² Suppose further that the individual is deciding how to spend an hour of their time. Below, you are given information about the meal options and how each meal contributes to the "Home" ("Z") portion of utility and the "Health" ("H") portion. Meal Health (H) contribution to Utility Puzzle Jogging Watching netflix +10 Home Good (Z) contribution to Utility Jogging Watching netflix Doing a puzzle If the individual is in a one-period model, meaning they only care about maximizing utility today, what will they choose? +1 +3 +3 +5 +3
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4 Part Question on Caesar * * PART 1 * * Caesar has preferences that are described by the utility function u = 3x 1 + 5x 2. Caesar strictly prefers the bundle (x 1, x 2) = (0, 6.6) to the bundle A. (3, 3) B. (5, 3.6) C. (0, 8.4) D. (11, 1.8) E. (8, 3.60) * * PART 2 * * What is the functional form of Caesar’s preferences, or indifference curves? A. Linear (perfect substitutes) B. Leontief (perfect complements) C. Satiation D. Concave, but not strictly concave E. Cobb-Douglas * * PART 3 * * Caesar’s preferences are A. strictly convex. B. definitely not well-behaved. C. definitely well-behaved. D. strictly concave. E. neutral. * * PART 4 * * Caesar has been consuming the bundle (x 1, x 2) = (10, 2.4). At this point, what is the marginal rate of substitution? A. – 0.25 B. –0.6 C. – 1.67 D. – 3.0 E. – 5.0.
At last time you have answered my question ,but I still have some problems want to ask you and there is not yet complete . Can you help me to use the Budget Line and Indifference Curve concepts and graph to explain to me how changes in income and prices of the goods will give rise to changes in the highest satisfaction. Does the budget line will increase too when the goods or services are increasing? The below is you have answered me at last time
solve g, h please Thank you
Using the homogeneity of indirect utility, which of the following cannot be an indirect utility function? (a) V: = (b) V: = (c) V: = [2 PzPy I Pz+Py p²+p² (d) V = 1 Pz
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