What is the indirect utility function?○OV(Pa, Py, I) =V (Px, Py, I)V (Px, Py, I)==V(Pay PyyI) =V(Pa, Py, I) =V (Px, Py, I) ==V (Px, Py, I) ==V(Pz, Py, I) =I4p2+3pyI3px +4py31Px41Py4IPy31Px41Px31PyforforforforforforPxPyPxforPyforPxPyPxPyPrPyPxPyPaPyPxPyVA4343V34 34جرا من جرام3030 Gina is at a toy store and is buying toy T-Rex's (x), which cost px, and toy yaks (y),which cost py. Her income is I. She likes 3 T-Rex's as much as she likes 4 yaks. Thesetoys are perfect substitutes for her.

The indirect utility function is especially important in microeconomic theory because it develops…

What is the indirect utility function? ○ [V (Pa, Py, I) = V (Px, Py, I) = V (Px, Py, I) V(Pa, Py, I) = Of ○ [V (Pa, Py, I) = V(Pa, Py, I) = = V (Px, Py, I) = V(Pa, Py, I) = I 4px +3py I 3px +4py 31 Px 41 Py 41 Py 31 Pa 41 Px 3I Py for for for for Pa Py Px for P > 2/20 Py for for Px Py Px Py Pa Py Px Py VA VA COLA COLA 3434 Pa Py for /> // Py 3

What is the indirect utility function? ○ [V (Pa, Py, I) = V (Px, Py, I) = V (Px, Py, I) V(Pa, Py, I) = Of ○ [V (Pa, Py, I) = V(Pa, Py, I) = = V (Px, Py, I) = V(Pa, Py, I) = I 4px +3py I 3px +4py 31 Px 41 Py 41 Py 31 Pa 41 Px 3I Py for for for for Pa Py Px for P > 2/20 Py for for Px Py Px Py Pa Py Px Py VA VA COLA COLA 3434 Pa Py for /> // Py 3

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Gino derives utility from only two goods, carrots (Qc) and donuts (Qd). His utility function is as follows:U(Qc,Qd) = (Qc)(Qd)The marginal utility that Donald receives from carrots (MUc) and donuts (MUd) are given as follows:MUc = Qd MUd = QcGino has an income (I) of £120 and the price of carrots (Pc) and donuts (Pd) are both £1. - suppose a lump sum tax of the same dollar amount, of a 1 pound tax per unit on donuts, is levied on Gino. what is Gino's utility maximising market basket? - why would Gino prefer a per unit tax over the lump sum tax, or vice versa, or why is he indifferent between the two taxes.
please explain the marginal utility and when exactly to use it ?
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