Suppose a person has $8 to spend only on applesand bananas. Apples cost $.04 each and bananascost $.01 each. Furthermore, his preferences forapples (A) and bananas (B) can be represented byU = the square root of AB.a.) If A =5 and B=80, what will utitly be?b.)lf A =10, what value of B will provide the sameuititly in part a?c.) If A=20, what value of B will provide the sameutility in parts a and b?

utility in economics can defined as the total satisfaction received from the consuming good or…

U = the square root of AB. a.) If A =5 and B=80, what will utitly be? b.)lf A =10, what value of B will provide the same uititly in part a? c.) If A=20, what value of B will provide the same utility in parts a and b?.

U = the square root of AB. a.) If A =5 and B=80, what will utitly be? b.)lf A =10, what value of B will provide the same uititly in part a? c.) If A=20, what value of B will provide the same utility in parts a and b?.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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just do part c and explain it
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Exercise 4. In the lectures we have been working the the CRRA utility function, u : R+ which we defined, for any n≥0, as → R, Prove that u(x): -{ 21--1 1-n if ŋE [0,1) U (1,∞) In a if n = 1. 2--1 lim == Inz. →1 1-7 (7) Hint: Use L'Hôpital's Rule. Exercise 5. Consider the following two-period optimization problem we studied in class: max u (x1)+ẞu (x2), s.t. x1+px2=y, (1.22)ER² (8) where u is given by (7), x; represents consumption of good i = {1,2}, ẞ € [0, 1] is the discount factor, p = R++ is the relative price of good 2 in terms of good 1, and y = R++ is income expressed in terms of good 1. For the following two questions, consider an arbitrary n > 0. 1. Find the bundle (1, 2) that solves (8). 2. Notice that the solution (1, 2) depends on the parameters (n,3,p,y), which the con- sumer takes as given. Derive the expressions for ǝr/Op and ǝx/Əp.
ê Suppie Concumer bes a utility function 4 x, (x,+2=) and facer a M. 'Derive and giet ber dem and for goed 2.
Question 3Draw indifference curves for the following sets of preferences and indicate the direction inwhich the individuals’ satisfaction (or utility) is increasing. Be specific about slopes when itis necessary. Assume for both parts (a) & (b) that soft drinks are measured on x-axis andhamburgers on the y-axis. (a) Mary always gets twice as much satisfaction from an extra hamburger as she does froman extra soft drink. (b) Bob loves soft drinks but dislikes hamburgers.
Solve this pls
can you please explain question d for me and solve it